March soybeans and soybean meal led grain prices lower Friday after USDA’s weekly report showed new marketing year lows of export sales for corn, soybeans, meal, wheat, rice and pork. The U.S. dollar index also contributed to grains’ lower closes, trading higher after the Labor Department showed a bigger-than-expected wage increase in December.
Corn and beans were lower at midday following some low weekly sales numbers.
Corn trade is 1 to 2 cents lower at midday and we have been down around 4 cents due to a firmer dollar and low weekly sales number. The weekly export sales were a marketing year low at 429,000 tons. Granted it was a slower holiday week so the market is not too concerned, but with South American new crop supplies not too far away the market will be watching exports closely as we move forward.
The weekly ethanol report yesterday showed record production, with production up 1.46% on the week and stocks down .03%. So there was positive weekly usage data yesterday. There are limited fresh weather news to be concerned about illustrated by the lower corn and soybean trade here at midday.
On the March corn chart support is at the $3.55 20-day moving average, then the $3.51 100-day and lowest major moving average. Resistance is at $3.65 which is the upper Bollinger band as well as the area of our 2-month high.
Soybean trade is 11 cents lower on new crop and 15 lower on March at midday due to some chart selling and a low weekly export sales number. Meal is down $6.50 and bean oil is down 15 points. The weekly soybean sales were 87,500, down 90% from a week ago.
Meal sales were only 83,300 tons and bean oil sales were good at 30,900 tons. The dollar strength is negative as well but at least crude is giving light spillover outside market support to limit downside.
South American weather is not helping out the market bulls today with limited fresh concerning news to talk about. Some production estimates have slipped the past week or two, but no one appears to be concerned about a major issue, i.e. a big South American crop is expected to keep world supplies at historic high levels. Demand may need to still pick up more to be the force that keeps beans above $$10.
On the March chart we are just below $10 at midday and are about to challenge support at the $9.96 100-day moving average which is the lowest major moving average. The low on Tuesday at $9.92 3/4 is the next level of notable chart support then the $9.83 3/4 2-month low Midday resistance is at the $10.07 200-day then the $10.21 20-day moving average.
Wheat trade is slow at midday with chart buying appearing to keep wheat from slipping and keeping the higher chart trend intact. Chicago is steady, off 2 cents from the daily high and December-January high, Minneapolis is up a penny and Kansas City is up 2 cents. There is limited fresh news this morning to drive the futures higher.
The weekly export sales were only 183,700 tons which is a marketing year low. The dollar is higher and there are limited additional weather issues to talk about.
The chart is good with the move above the 100-day moving average and close above it on Thursday. This level is now support at $4.31 on the Kansas City March contract. A second daily close could still attract fund or small speculative buying here. Fundamentally it is hard to be friendly, but the long-term lows we are at, or near by, give wheat a longer-term ownership appeal.