March contracts of corn, soybeans and all three wheats posted modest gains Friday after USDA released WASDE, Crop Production, Grain Stocks and Winter Wheat Seedings reports. Most outside commodities were also higher, benefitting from a small decline in the U.S. dollar.
Corn trade is 2 to 3 cents lower in quiet trade ahead of the report at 11 central time with light selling ahead of the report as we test support. Ethanol margins will see further pressure if corn finishes the day positive with ethanol futures mired at the low end of the range again. U.S. weather looks to be more active to the east, allowing for more movement west for now, while South America remains mixed.
Basis has remained sideways. Weekly sales remain disappointing at 161,888 metric tons. On the report, the average yield estimate is 166.2 BPA, for production of 13.513 billion bushels on acres of 81.35 million, with corn stocks at 11.53 billion for a carryout of 1.757 billion.
On the March contract support is the lower Bollinger Band at $3.80 with trade testing the 20-day at $3.85 overnight.
Soybeans trade is narrowly mixed with trade remaining in the range pre-report. Meal is $1.50 higher to $2.50 higher, and oil is 25 to 35 points lower. The export wire has been quiet all week, with weekly sales disappointing at 355,542 metric tons of beans, 74,325 metric tons, and oil at 2,577 metric tons.
South American weather has the biggest holes in Argentina in the short term, with Brazilian coverage better to the north with CONAB raising crop size expectations slightly on their report. Basis has remained firm at processors with the strong crush margins.
On the report, the average estimate is for yield at 46.6 BPA for production of 3.512 billion bushels on 75.462 million acres, with stocks at 3.186 billion and carryout at 424 million bushels. The March chart support is at the 20-day at $9.41 with resistance at the $9.61 upper Bollinger Band.
Wheat trade is 3 cents lower to 1 cents higher with light buying evaporating ahead of the report, and nearby Kansas City closing in on the $5.00 area before fading. Cold threats remain limited for the Plains with a system potentially moving in next week, with little snow cover currently but it doesn’t look cold enough for significant issues, while Russia has been warmer and drier than usual.
Spread action is narrower, putting Kansas City at a 72 cent discount to Chicago, while Minneapolis is back to a 8 cent discount. Weekly export sales remained soft at 80,567 metric tons of old crop, and 50,000 metric tons of new crop.
On the report, trade is looking for an average guess of 30.664 million acres of winter wheat, 1.917 billion bushels of stocks, and carryout of 969 million bushels. The March Kansas City chart support is the 20-day moving average at $4.70, with resistance the upper Bollinger Band at 4.98, then $5.00.