March soybeans fell 13 1/2 cents Wednesday after the U.S. and China signed a long-awaited phase-one trade agreement, which holds China to $36.5 billion of U.S. ag purchases in 2020. Wheat prices were mixed, but saw a 4 3/4 cent gain in the March Chicago contract.
Corn trade is 1 to 2 cents lower with action remaining just below the recent highs with good support showing on breaks so far this week but buying drying up quickly. Ethanol margins remain tight, with the weekly report coming in with production 1.095 million barrels per day, 44,000 higher on the week, with stocks 544,000 barrels higher.
U.S. weather looks to be more active to the east, allowing for more movement west for now, while South America remains mixed but without widespread issues short term. Basis has remained sideways.
On the March contract support is the 20-day at $3.87, which we are just above at midday, and resistance is the upper Bollinger Band at $3.92.
Soybean trade is 3 to 5 cents lower at midday with rangebound action continuing with trade trying to keep ahead of nearby support with the trade deal signing today, but without publication of targets for specific commodities although bean buying is expected to be substantial with 126,000 metric tons old crop sold to China on the daily wire. Meal is flat to 1.00 higher, and oil is 40 to 50 points lower.
The Brazilian real found footing after the break Monday, but remains cheap vs. the dollar. South American weather remains within the recent pattern for soybeans as well.
Basis has remained firm at processors with the strong crush margins. The March chart support is at the 20-day at $9.44 which we are just below at midday with the lower Bollinger Band at $9.34 below that with resistance at the $9.54 upper Bollinger Band.
Wheat trade is 1 cent lower to 5 cents higher with Chicago trade leading again at midday with new highs being scored as March Kansas City edges back to $5.00 before pulling back again. Cold threats remain limited for the plains with most of the moisture staying to the east, with western snow cover remaining limited, while Russia has been warmer and drier than usual along with usual Russian governmental action today.
Spread action is steady to a little wider, putting Kansas City at a 75 cent discount to Chicago, while Minneapolis is back to a 18 cent discount. The March Kansas City chart support is the 20-day moving average at $4.78, with resistance the upper Bollinger Band at 5.03.