Nearly all commodities were showing losses Wednesday, including closing prices of grain and livestock after the President reminded the nation the worst of the coronavirus pandemic is not over yet. The U.S. Energy Department reported a big drop in last week’s ethanol production, resulting in ethanol prices at new all-time lows.
Midday: Corn is 3 to 8 cents lower, soybeans are 13 to 20 cents lower, and wheat is 12 to 17 cents lower.
Corn trade is 3 to 8 cents lower at midday with the front months holding up better with widespread liquidation. Ethanol margins remain very poor, with the weekly report showing production 165,000 barrels per day lower, with stocks 1.55 million barrels higher.
Corn basis will likely continue to see pressure except for export-oriented locations. Rains will keep early fieldwork slow. On the report, acres came in at 96.99 million vs. 94.33 million expected, with stocks at 7.953 billion bu. 8.125 expected.
On the May contract support is the lower Bollinger Band at $3.25, and resistance the 20-day at $3.55.
Soybean trade is 13 to 20 cents lower with trade unable to push higher post report with overbought conditions and little fresh bullish news. Meal is $3.00 to $4.00 lower and oil 100 to 110 points lower.
South America is continuing to harvest with port disruptions this biggest concern at the moment with talks of strikes in Argentina as well, while the Brazilian ral remains very weak. New-crop soybeans will need to gain vs. corn to provide an acreage incentive with the price ratio now at 2.4 or better with time running down for soybeans to make a decisive move.
On the report, soybeans acres were 83.51 million vs. 84.865 expected, and stocks at 2.253 billion bu. 2.241 expected. The May soybean chart support is the 20-day at 8.67 which we are just below at midday, and the recent high at $8.97 as resistance.
Wheat trade is 14 to 17 cents lower with front-month Chicago trade the downside leader as the nearby inverses fade from a dime to 3 cents. Russia continues to review export policies for the short term as well, with local values elevated but fresh bullish news is needed to push wheat.
Kansas City is at a 73-cent discount to Chicago on the May with choppy trade continuing, while Minneapolis is minus 24 with narrower action this week.
On the report acres came in at 44.7 million vs. 44.982 million expected and stocks were 1.412 billion vs. 1.432 expected. The May Kansas City chart support is the 20-day at $4.61, with resistance the $5.13 upper Bollinger Band.