Corn
Price action: May corn rose 2 1/2 cents to $4.61, forging a near mid-range close.
Fundamental analysis: Corn futures were firmer throughout the session, with strength in wheat futures and a weaker U.S. dollar lending support. However, technical pressure stemming from the 10- and 100-day moving averages pressured prices as the session progressed. Meanwhile, weekly export inspection data was somewhat supportive, with USDA reporting net inspections of 1.66 MMT for the week ended March 13, down 185,557 MT from the previous week but within the pre-report range of 1.0 to 1.95 MMT.
Meanwhile, in Brazil, safrinha corn plantings are mostly complete at 97% as of last Thursday, according to AgRural, though weather continues to be closely monitored as the seasonal rainy period is nearing an end. At the end of last week, domestic corn prices in Brazil rallied to the highest level since April 2022 amid strong demand for feed and ethanol, combined with low inventories. The current supply situation will be likely to remain tight ahead of Brazil’s safrinha corn harvest in early summer.
While recent fund selling has pressured corn prices, funds continue to hold a net long position. Risk-off sentiments across the marketplace have forced longs to take cover amid trade uncertainty and growing recessionary fears. Look for traders to continue to lean risk averse, with a special focus on this week’s FOMC meeting and post-meeting comments from Fed Chair Powell, which will provide insight into any changes in monetary policy.
Technical analysis: May corn futures continued to face resistance at the 10- and 100-day moving averages, trading around $4.64 1/2 and $4.66 1/4, while support held at the 200-day moving average of $4.54 3/4. Bulls and bears are on a level playing field, with bulls looking to secure a close above last week’s high of 44.77 1/2, while bears look to secure a close below support at $4.42. First resistance stands at $4.70, then $4.75, while first support lies at $4.59 3/4 and $4.56 1/4.
What to do: Get current with advised sales.
Hedgers: You should be 70% sold in the cash market on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Cash-only marketers: You should be 70% sold on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Soybeans
Price action: May soybeans fell half a penny to $10.15 1/2 and near mi-range. May meal fell $1.60 to $304.3. May bean oil climbed 51 points to 42.10 cents.
Fundamental analysis: Soybean futures struggled to build much bullish momentum today despite persistent strength in grains, particularly wheat futures. Losses in meal undercut soybeans today as meal struggled to stray far from the psychological $300.0 level. Meal futures failed to establish any bullish momentum despite NOPA crush coming in well below expectations. NOPA’s crush report for February came in at 177.87 million bushels, down 22.513 million bushels from January. It was bearish against expectations, below trade forecasts of 185.229 million bushels from a Reuters poll. NOPA soybean oil stocks totaled 1,503 million pounds and were up 228.271 million pounds from last month’s figure. Stocks came well above the average trade estimate of 1,386 million pounds in the Reuter’s survey. Crush demand for beans has dropped modestly as soyoil use for biofuels has moderated since the beginning of the year. February’s figure for meal stocks, released on April 1, will give insight into how meal demand has held up.
AgRural reported the Brazilian soy harvest as 70% completed, up from 61% a week ago and 63% a year ago at this time. Production losses in Rio Grande do Sul continue to garner attention as hot and dry weather are limiting yields. Regular bouts of rain are expected over the course of the next couple of weeks from Mato Grosso and northern Mato Grosso do Sul to Goias, southern Minas Garais and Espirito Santo, slowing harvest at times, says World Weather Inc.
USDA reported weekly soybean inspections of 646,667 MT (23.8 million bu.) for the week ended March 13, down 206,978 MT from the previous week but within the pre-report range of 300,000 to 950,000 MT. Soybean inspections are falling seasonally, though accumulated inspections continue to run well ahead of the required pace to hit USDA’s export estimate of 1.825 billion bushels.
Technical analysis: Soybeans struggled and failed to topple downtrend resistance and the 10-day moving average, which have converged at $10.16 1/2. Strength above that mark would target psychological resistance at $10.25. Bears continue to maintain the technical advantage and are looking to overcome initial support at $10.09 3/4 before tackling firmer support at the psychological $10.00 mark.
May meal futures gave up most of Friday’s gain today. Prices are pinned between 40-day moving average resistance at $305.10 and 10-day moving average support at $303.3. Additional strength has bulls eyeing resistance at $309.50, while staunch support stands at $300.00.
What to do: Get current with advised sales. Our next sales target is $11.00 in nearby futures.
Hedgers: You should be 55% sold in the cash market on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Cash-only marketers: You should be 55% sold on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Wheat
Price action: May SRW wheat rose 11 1/2 cents to $5.68 1/2, nearer the session high and hit a three-week high. May HRW wheat gained 19 1/2 cents to $6.05 1/2, nearer the daily high and hit a three-week high.
Fundamental analysis: The winter wheat futures markets were boosted today by forecasts for extreme weather in U.S. winter wheat country, and by technical buying as the near-term chart postures for both SRW and HRW have turned more bullish. A weaker U.S. dollar index today was also supportive to the wheat futures markets.
World Weather Inc. today said that in U.S. HRW regions, “widely swinging temperatures, excessive wind and blowing dust along with very low humidity and limited precipitation continues to stress many crops. Rain is needed along with more consistent milder temperatures to induce new tillering for damaged wheat. Without these changes some production cuts will be inevitable.” The forecaster added that a windy weather pattern will continue this week with more extreme winds expected that will cause additional dust storms. The strongest winds will occur Tuesday into Wednesday as another strong area of low pressure moves through. Some of these wind gusts will be as high as 55 to 75 mph. A blizzard is likely late Tuesday into Wednesday from part of central Kansas through central and southeastern Nebraska.
USDA reported U.S. weekly wheat inspections of 492,658 MT for the week ended March 13, up 251,012 MT from the previous week and above the pre-report range of expectations.
U.S. Plains states will update their weekly state crop progress reports later this afternoon, which will be closely scrutinized by wheat traders.
Fundamental analysis: SRW wheat market bulls and bears are back on a level overall near-term technical playing field but prices are trending higher now. SRW bulls’ next upside price objective is closing May prices above solid chart resistance at $6.00. The bears’ next downside objective is closing prices below solid technical support at $5.40. First resistance is seen at today’s high of $5.75 1/4 and then at $5.80. First support is seen at today’s low of $5.59 and then at $5.50.
The HRW bulls have the overall near-term technical advantage. Bulls’ next upside price objective is closing May prices above solid chart resistance at the October 2024 high of $6.47 3/4. The bears’ next downside objective is closing prices below solid technical support at $5.70. First resistance is seen at today’s high of $6.09 and then at $6.23. First support is seen at today’s low of $5.91 and then at $5.80.
What to Do: Get current with advised sales.
Hedgers: You should be 85% sold in the cash market on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cash-only marketers: You should be 85% sold on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cotton
Price action: May cotton fell 39 points to 66.98 cents, ending near the session low and below the 40-day moving average.
Fundamental analysis: Cotton favored the downside to begin the week, despite outside market support, though technical support curbed notable selling efforts. Meanwhile, surprisingly positive economic data from China which was released overnight failed to lend much support as the Organization of Economic Cooperation and Development (OECD) think tank reported it expects global economic growth to slow to 3.1% from 3.3% in its previous forecast. Moreover, consolidation ahead of this week’s FOMC meeting is certainly likely as the marketplace waits for comments from Fed Chair Jerome Powell on Wednesday after the meeting adjourns.
Weather continues to prove a bit uncertain ahead of spring, with World Weather Inc. maintaining that rain is needed in the southwestern desert region, southern California and both South and West Texas. The Blacklands are also expected to dry out in the coming week, with additional rain needed in the southeastern states despite moisture last week. The forecaster notes excessive wind in West Texas recently induced some soil erosion, though cotton planting does not begin before May 1.
Technical analysis: Cotton futures ended the session back below the 40-day moving average of 67.20 cents, which will now serve as initial resistance. Meanwhile, the 20- and 10-day moving averages of 66.44 cents and 65.80 cents will serve as initial support. Resistance at the 200-day moving average, currently trading at 69.79 cents will likely ward off hefty buying, though the March 4 low of 62.54 cents will continue to provide solid support.
What to do: Get current with advised sales and hedges.
Hedgers: You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.