Corn futures are 11 to 13 cents lower at midday Wednesday; soybean futures are 6 to 7 cents higher; wheat futures are 52 to 85 cents lower.
Corn futures are 11 to 13 cents lower at midday with weaker spread action as trade has worked more sideways this week with some position squaring possible ahead of the WASDE report at 11 a.m. today. But this is possibly one of the least anticipated reports on record given other events ongoing.
Ethanol margins will remain tight as we see how driving demand holds up. Also turnaround on plant maintenance will slow grind in the short term. Production edged slightly higher on the weekly report, up by 31,000 barrels per day (bpd) and stocks 338,000 barrels higher. The WASDE report is expected to show domestic carryout at 1.479 billion bushels (bb), along with slight cuts to world stocks and South American output.
Basis will continue to trend lower until trade starts to calm down. Trade will continue watching South American weather as we head into second-crop development, the key feature, while corn looks to be defending acres in the U.S. ahead of planting. On the May contract we have support at the 20-day moving average at $6.88 with resistance at the fresh high at $7.82 3/4 hit Friday.
Soybean futures are 6 to 7 cents higher at midday with trade pulling back from the 44-cent higher surge in the middle of the night with firmer spread action as May struggled to hold over $17.00 ahead of the tighter numbers expected on the WASDE report. Meal is $7.00 to $8.00 higher and oil is 30 to 40 points higher.
Basis is expected to remain flat to weaker in the short term until futures action calms down, but the big moves seen elsewhere shouldn’t be as common. The daily export sales wire stayed active with 100,000 metric tons (mt) sold to Colombia for old crop and 20,000 of soy oil to unknown for old crop.
The WASDE report is expected to show domestic carryout at 278 million bushels (mb), down about 50 mb from last month, with world stocks down 3 million metric tons (mmt) and 5 mmt more in production cuts from South America. Harvest is underway in South America with weather remaining mixed and the U.S. still holding some export competitiveness in the short term as estimates for production continue to sit around 125 mmt in Brazil.
On the May soybean chart, we have resistance at the fresh high at $17.59 with trade well above the 20-day moving average at $16.29 support.
Wheat futures are 52 to 85 cents lower at midday with 85-cent limits returning Wednesday after failing to hold expanded limit lower trade Tuesday. Action did touch limit at times this morning as markets look to see how the fresh talks between Russia and Ukraine go, along with the breadth of Russia’s embargos on exports to unfriendly countries.
The dollar is backing off the highs a bit as well to boost U.S. export competitiveness. Some moisture worked across parts of the Plains with colder weather near term and snow possible Wednesday for Kansas and Nebraska growing areas. The WASDE report is expected to show domestic carryout at 628 mb, down slightly from last month, with world stocks down about 1 mmt.
Chicago is expected to remain the highest priced nearby contract with an 88-cent premium to KC today, and .95 versus Minneapolis action. KC May chart support is the low from Wednesday at $11.14 with resistance the $12.99 1/2 fresh high.
The U.S. stock market is firmer with the Dow 600 points higher. The U.S. Dollar Index is 108 points lower. Interest rate products are weaker. Energies are weaker with crude down 4.90. Livestock trade is mostly lower. Precious metals are weaker with gold down 37.00.