Wheat plummeted, leading corn and soybeans lower. Following Tuesday’s sharp and unexplained rally, Kansas City gave back nearly all of the 16-cent gain. Corn and soybeans fell early on bearish weather in South America, open harvest weather in the U.S. and China trade deal concerns.
Midday: Wheat is the downside leader in soft midday trade.
Corn trade is 1 to 2 cents lower with choppy trade continuing as trade works to build broader support at the lower end of the range. Harvest will be aided by a warm up into the weekend. Ethanol margins remain stable, with ethanol futures flat, helping to support blenders with unleaded still near the recent highs, and the weekly ethanol report delayed until tomorrow.
Basis has held up well with the slow pace of harvest so far. South America should see areas of improvement as planting progresses, especially in Brazil. Weekly crop progress showed harvest at 66% vs. 85% on average.
On the December contract, support is the $3.71 lows from October, with resistance the spike high from Friday at $3.83 3/4.
Soybeans are flat to 2 cents lower at midday with buying still scarce as trade tries to hold the support levels from Monday. Meal is $1.50 to $2.50 higher, and oil is 35 to 45 points lower. The ral has remained at the lows since slipping last week, hindering U.S. competitiveness but we did see 106,000 metric tons sold to unknown on the daily wire.
Bean basis has moved to a more sideways trend short term. South America should make more progress through the week with improved weather, and Brazil heading towards the planting homestretch. Weekly crop progress showed harvest at 85% complete vs. 92% on average.
On the January chart, support is the lower Bollinger Band at $9.15, which we are just above at midday with resistance well above the market at $9.35.
Wheat trade is 5 to 8 cents lower with trade pulling back from the sharp Tuesday gains with spring wheat holding up the best so far. The Chicago/Kansas City December spread is 78 cents with narrower action to start the week.
The corn/HRW spread has narrowed back to 55 cents, keeping wheat out of rations. Russian values remain elevated with Australia dry, but the U.S. is still struggling to capture a larger share, with the dollar remaining at the upper end of the range. Weekly crop progress showed good to excellent down 3% to 54% good to excellent, and 13% poor to very poor, with 92% planted same as average, and 78% emerged vs. 81% on average.
The December Kansas City chart support is the 20-day at $4.25 with resistance the upper Bollinger Band at $4.36, which we tested overnight.