Early on Thursday, news that the number of infections and deaths from coronavirus, as a new and quicker testing method was used, sent equities, energies and ag commodities to early losses. Soybeans and crude oil were able to overcome that early selling to close higher.
Wheat and corn closed down. With the start of the phase-one trade deal to begin on Saturday, there is a glimmer of hope that China could issue tariff waivers for U.S. soy purchases right after the President’s Day holiday.
Midday: Corn is 2 to 3 cents lower at midday, soybeans are 4 to 6 cents higher, and wheat is 4 to 6 cents lower.
Corn trade is 2 to 3 cents lower at midday with light selling as remain solidly range bound with little fresh news. Ethanol margins remain flat with futures flat.
Corn basis remains steady to slightly softer, with little change in recent days but more open weather should help movement along with March basis contracts coming due. Argentina has gained competitiveness vs. the US in recent days with the export market remaining quiet. Weekly export sales held up well at 968,800 metric tons.
On the March contract support is the lower Bollinger Band and the fresh lows at $3.75, then the $3.71 4-month low, with resistance at the $3.94 recent 2 1/2 month high with the 20-day just above the market at $3.83 which we remain just below.
Soybean trade is 6 to 7 cents higher with March with front month action leading again as we test $9.00 nearby. Meal is $1.00 to $2.00 higher and oil is 30 to 40 points lower.
South America continues to make good progress with weather and harvest moving forward with little change on the horizon. The Brazilian real remains very cheap as well hurting U.S. export competitiveness near term.
New crop soybeans will need to gain vs. corn to provide an acreage incentive ahead of planting in the U.S. as well. Weekly export sales showed improvement at 644,800 metric tons of soybeans, meal at 234,200 metric tons, and 39,100 of oil.
The March soybean chart support is the $8.61 lower Bollinger Band, with resistance the 20-day at $8.94, which we are above at midday.
Wheat trade is 4 to 7 cents lower with the higher-protein wheats holding up a little better. Weather threats for the plains remain limited near term domestically with limited short-term moisture across most of the plains.
Kansas City is at a 78-cent discount to Chicago, regaining a nickel the last few days while Minneapolis is back to an 18 cent discount as well. World values remain mostly elevated with Chicago wheat expensive, and Kansas City wheat on the low end and Egypt expected to return for tenders soon. Weekly export sales improved to 643,100 metric tons.
The March Kansas City chart support the lower Bollinger Band at $4.56, with resistance the 20-day at $4.78.