Corn futures are 16 to 18 cents higher at midday Thursday; soybean futures are 20 to 22 cents higher; wheat futures are 32 to 98 cents lower.
Corn futures are 16 to 18 cents higher at midday, bouncing back towards the upper end of the recent range with good export sales and firmer spread action providing support. Ethanol margins will remain tight as we see how driving demand holds up along with turnaround on plant maintenance slowing grind in the short term with short-term driving demand holding up OK.
The WASDE report showed domestic carryout at 1.440 billion bushels (bb) versus 1.479 bb expected, along with slight cuts to world stocks and South American output. Basis will continue to trend lower until trade starts to calm down with more steady action the last few days. Trade will continue watching South American weather as we head into second-crop development, while corn looks to be defending acres in the U.S. ahead of planting.
Weekly export sales were very strong at 2.14 million metric tons (mmt) old crop and 22,900 metric tons (mt) of new crop. On the May contract we have support at the 20-day moving average at $6.93 with resistance at the fresh high at $7.82 3/4 hit Friday.
Soybean futures are 20 to 22 cents higher at midday with trade trying to rebound from the reversal Wednesday and push the May contract back past $17.00 yet again. Meal is $12.50 to $13.50 higher, and oil is flat to 10 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 was quiet for the first time in a few days. The WASDE report came in as expected with domestic carryout at 278 million bushels (mb), down about 50 mb from last month, with world stocks down 3 mmt, and 8.5 mmt more in production cuts from South America. Harvest is underway in South America with weather remaining mixed.
The U.S. is still holding some export competitiveness in the short term as estimates for production continue to sit around 125 mmo in Brazil. Weekly export sales were strong at 2.2 mmt of old crop, 895,000 mt of new crop, 316,600 of old crop meal, and 16,600 of oil. 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 $16.33 as support.
Wheat futures are 32 to 98 cents lower in continued volatile action with dollar ranges already in the day’s trade as action rallied as ceasefire potential in the near term was down played, but shipments look to resume from Russia and Ukraine in at least limited fashion and the rally turned out to be pretty short lived.
Intramonth spreads are also collapsing Thursday. Limits are 130 cents Thursday for winter wheat. The dollar is backing off the highs a bit as well to boost U.S. export competitiveness as most buyers have headed to the sidelines for now. Some moisture worked across parts of the Plains with colder weather near term and snow possible Thursday for Kansas and Nebraska growing areas with the second week forecast potentially wetter again.
The WASDE report raised wheat carryout by 5 mb to 653 mb, with world stocks down rising by about 3 mmt. Chicago is expected to remain the highest priced nearby contract with a 35-cent premium to KC contracting sharply and .53 versus Minneapolis action. Weekly export sales were 307,200 mt of old crop and 63,000 mt of new crop. KC May chart support is the low from Thursday at $10.58 with resistance the 12.99 1/2 fresh high.
The U.S. stock market is weaker with the Dow 450 points lower. The U.S. Dollar Index is 45 points higher. Interest rate products are weaker. Energies are mixed with crude up .90. Livestock trade is mixed. Precious metals are firmer with gold up 13.00.