December Minneapolis wheat closed up 7 1/4 cents Tuesday, continuing to put pressure on noncommercial shorts for a fifth consecutive day. Row crops posted small gains after USDA once again described slowly developing corn and soybean crops in the fields.
Spring wheat leads mixed midday trade.
Corn is flat to 1 cent higher at midday with two sided trade after conditions improved on the weekly report, and little fresh news otherwise. Rains will slow early harvest in many areas in the short term, but temps should remain warm with some cooler air to the north next week.
Corn basis is expected to continue to see pressure as harvest gets going but remains elevated in many areas. Ethanol margins are stable with improved margins holding on, with unleaded and ethanol both slightly lower this morning. Mexico secured 200,000 metric tons of corn on the daily wire.
Weekly crop progress showed 57% good to excellent, and 13% poor to very poor, up 2 percentage points, with 96% in the dough vs 100% on average, 79% dented vs. 94% average, 29% mature vs 57% on average and 7% harvested vs. 11% on average.
On the December contract support is at the 20-day at 3.65 with the upper Bollinger Band above trade at 3.77.
Soybeans is 2 to 4 cents higher with support from weather and trade optimism but we remain trapped below $9.00 nearby. Meal is $2.00 to $3.00 higher and oil is flat to 10 points lower. Crush margins remain good, but the bull argument needs a positive export story besides sporadic sales to China with 10 more cargos noted yesterday but nothing on the daily wire yet.
Economically U.S. export competitiveness is improving but the ral has moved back to the lower end of the range. Bean basis remains flat in the interior. South America will be watched for a turn to wetter near-term weather to get planting underway with parts of Brazil trending wetter, with Argentina expected to be drier.
Weekly crop progress was unchanged at 54% good to excellent and 13% poor to very poor, with 34% dropping leaves vs. 68% on average.
On the November chart are back above the moving averages clustered in the $8.87-8.90 range, with the upper Bollinger Band remaining resistance at $9.06.
Wheat trade is 2 cents lower to 10 cents higher with spring wheat leading on late harvest problems and quality concerns. The Kansas City/Chicago spread is 75 cents, with choppy action to start the week.
The corn/HRW spread is hanging around the 35-40-cent area. The spring wheat strength should boost higher protein bids, with Kansas City wheat still on the edge of rations in the Southern Plains. Winter wheat planting should expand more this week, but the market is not providing incentives to plant any more acres than necessary.
Weekly crop progress showed winter wheat 22% planted vs. 24% on average, and spring wheat 87% harvested vs. 97% on average.
The December Kansas City chart support is at the 20-day at $4.00 1/2, with resistance at the upper Bollinger Band at 4.15, which we are just below.