March KC wheat closed up 5 1/2 cents Tuesday, supported by USDA’s lower winter wheat crop rating, Canada’s rail strike and Tuesday’s broad demand for wheat in general. December corn and January soybeans were modestly higher with harvest work still unfinished.
Midday: Broadly firmer trade at midday, with spring wheat the laggard.
Corn trade is 4 to 5 cents higher with good buying amid oversold conditions so far today, with little fresh news except 191,000 metric tons of corn hitting the daily wire. Ethanol margins remain stable with ethanol futures following the corn rally this a.m., while blender margins compress.
Basis has held up well with the slow pace of harvest so far with propane shortages still noted, but warmer weather should help through this week with midweek rains slowing progress in some areas. South America should see areas of improvement as planting progresses, especially in Brazil. Harvest progress was rated at 76% vs. 92% on average.
On the December contract support is the $3.67 1/2 lows from Monday along with the lower Bollinger Band at $3.66, with resistance the 20-day at $3.80.
Soybeans are 5 to 6 cents higher with profit taking vs. recent shorts at midday with little fresh news otherwise as harvest winds up. Meal is 1.00 to $2.00 higher, and oil is 40 to 50 points higher. The ral remains at the lows with planting getting to 70% complete in Brazil and only limited near-term concerns.
Bean basis has moved to a more sideways trend short term with pockets of firmness showing up at crushers. Weekly harvest progress was 91% vs. 95% on average.
On the January chart support is the lower Bollinger Band at $9.07, which we are back above with resistance well above the market at $9.28 where the 20-day moving average, along with oversold conditions.
Wheat trade is flat to 8 cents higher with trade trying to build on the positive start to the week with further condition declines and a mixed forecast coming forward. The Chicago/Kansas City December spread is 87 cents with choppy action to start the week.
The corn/HRW spread has widened back to 51 cents, pushing wheat further from the feed bunk. The weaker dollar could help more if sustained vs. world values this week. Export business wil be watched with more Mediterranean tenders going out this week.
Weekly crop progress showed planting at 95%, same as average, with 83% emerged vs. 86% on average, with 52% good to excellent, down 2 percentage points, and 14% poor to very poor with some moisture expected for the west in the extended forecast.
The December Kansas City chart support is the lower Bollinger Band at $4.13, with resistance the 20-day at 4.23 which we are above at midday.