December corn closed down its 25-cent daily maximum limit after USDA estimated the 2019 corn crop at 13.9 billion bushels, based on a planting of a higher-than-expected 90 million acres. November soybeans and all three wheats also finished lower in spite of a lower-than-expected crop estimate for soybeans.
Midday: Broadly weaker trade ahead of the report.
Corn trade is 6 to 8 cents lower with selling ahead of the report. Rains have fired in the Western Belt overnight with mixed coverage over the weekend overall. Ethanol margins remain poor with the firmer energy complex helping to stabilize the recent ethanol futures break with futures hanging at 1.42 despite the small refinery waivers.
Basis has firmed again in some areas with the spread mostly sideways. Looking ahead to the report at 11 a.m, trade is looking for an old crop carryout of 2.392 billion bushels on old crop, and 1.632 billion on new, with yield at 164.9 BPA, on a wide range of acres with an average guess of 87.9 million.
Weekly export inspections improved at 703,183 metric tons. Weekly crop conditions are likely to remain steady with maturity still well behind normal.
On the September nearby chart support is the 10- and 100-day at $4.06-7 which we are below at midday and then the 200-day at $4.00. Resistance is at the 20-day at $4.17, which we tested Friday before fading.
Soybean trade is 6 to 8 cents lower with selling picking up this morning after rains moved through in pre-report action. Meal is $1.00 to $2.00 lower and oil is 10 to 20 points lower. World export demand remains slow, with the U.S. disadvantage persisting on the currency markets, with South American prices supported ahead of planting.
Showers should have reduced stress in some areas over the weekend, with weekly crop progress likely to show steady conditions, and lagging maturity. Weekly export inspections showed improvement at 934,288 metric tons. Expectations for the report have an average carryout guess of 1.065 billion bushels of old crop, and 821 million of new, with acres at 81 million and 47.6 BPA yield.
The September chart support is the 10-day at 8.66, with the lower Bollinger Band at $8.45 below that, with the next level of resistance the 20-day at 8.80.
Wheat trade is flat to 6 cents lower, following the lead of the row crops at midday with recent trends continuing. The Kansas City/Chicago spread has made new highs at 88 cents, scoring new highs again. The corn/HRW spread is back to 8 cents. Chicago Sep-Dec is steady.
Spring wheat harvest should expand with winter wheat just about wrapped up, with Europe continuing to move towards spring wheat harvest as well, with areas of delays with U.S. hard red wheat competitive on the world markets.
Weekly crop progress should show winter wheat harvest 90% complete, with spring wheat 10% done with steady conditions. Weekly export inspections were improved again at 703,183 metric tons. On the report, carryout is expected to be 999 million bushels.
The September Kansas City chart support is the new low at 4.07 3/4 with the first resistance the 10-day at 4.23, with the 20-day at 4.30 the next round up.