DTN Grain Midday: Broad Commodity Weakness

The Port of Rosedale - Rosedale, Mississippi - Mississippi River ©Debra L Ferguson Stock Photography

CORN

Corn trade is 8 to 9 cents lower with broad commodity weakness to start the week with concerns about coronavirus encouraging position liquidation until we see more clarity on short-term demand.

Ethanol margins should get a boost from cheaper corn, but blender margins have narrowed with ethanol futures still at the lower end of the range. U.S. weather should allow for better weather short term. Basis should remain sideways.

The weekly export inspections improved to 668,559 metric tons. The daily wire showed a couple of sales to Japan for new crop. On the March contract support is the lower Bollinger Band at $3.79 and then recent lows at $3.77, with resistance the top of the fresh gap at $3.84.

SOYBEANS

Soybeans trade 9 to 12 cents lower at midday with selling tied to the broad weakness in all markets, and continued progress in South America. Meal is $1.50 to $2.50 lower, and oil is 80 to 90 points lower.

The Brazilian ral remains very cheap as well hurting U.S. export competitiveness. South American weather remains within the recent pattern for soybeans as well with early harvest underway.

Basis has remained steady at processors with the strong crush margins and poor weather. Weekly export inspections were steady at 1.038 million metric tons. The March chart support is the $8.82 contract low, with resistance the lower Bollinger Band at $8.97.

WHEAT

Wheat trade is 2 to 7 cents lower with trade following the lead of the row crops overnight with little fresh wheat-specific news. Cold threats remain limited for the plains with limited potential short-term moisture.

Kansas City is at an 84 cent discount to Chicago, while Minneapolis is back to a 23 cent discount. Weekly export sales inspections were soft at 223,994 metric tons. The March Kansas City chart support is the lower Bollinger Band at $4.71, and resistance is the 20-day at $4.86.

General Comments

The U.S. stock market is weaker with the Dow down 460. The dollar index is 15 points higher. Interest rate products are weaker. Energies are weaker with crude down $1.50. Livestock trade is sharply lower. Precious metals are mixed with gold $10.00 higher.

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