Grain Market Commentary for March 8, 2017

March 9, 2017

Commodity Period Price Weekly Movement
Corn CBOT May 3.67  16 cents
Soybeans CBOT May 10.11  39 cents
Wheat CBOT May 4.44  13 cents
Wheat Minn. May 5.39  21 cents
Wheat Kansas May 4.63  14 cents
Chicago Oats May 2.40  06 cents
Canadian $ June 0.7412  0.75 points

Corn

The March 9 United States Department of Agriculture (USDA) report showed larger domestic and global ending corn stocks and confirmed large South American crops. Corn found our $3.80 overhead resistance level too much for this rally, but should still get to see another attempt in the coming weeks. Initial support is at the $3.60 level on May while overhead resistance is seen at $3.80 – $3.85. A pullback of a larger scale could see the May contract challenge the $3.40 and possibly even the $3.30 support levels.

Overall, the charts look positive in the long run, but we have hit a wall for the short term and it will need work before we attempt another run at the $3.80 level. Short term indicators are neutral, but the main trend is still down.

Soybeans

The USDA report pushed Brazil’s soybean crop to 108 mmt up four mmt from the previous month which was twice as much as the trade was expecting. Soybeans are about 12 cents lower after the report. The May contract is trading at $10.06 and it is important that we don’t break hard below the $10 mark and close there. On the other hand, the new crop soybean chart in November is looking much healthier and could actually be positive once we get through the old crop contracts. This could lead me to think there could be some surprises going into the new crop harvest prices.

Short term indicators have turned negative as indicated in last week’s commentary and the main trend is still down.

Wheat

While still in a corrective mode but still looks more positive than its counter parts. The USDA showed U.S stock a bit smaller than expected, but that was offset by global stock being a bit larger. Prices are off about four cents near the close and we have support at the $4.30 – $4.40 level based on the May Chicago contract, while overhead resistance is still at $4.65 also based on the May contract.

Both short and intermediate term indicators are still positive, but the primary trend is still down.

Harvest 2017 crop cash prices as of close on March 9, 2017
SWW @ $213.22/MT ($5.80/bu), HRW @ $213.22/MT ($5.80/bu),
HRS @ $234.54/MT ($6.38/bu), SRW @ $213.22/MT ($5.80/bu).

Grain Market Commentary for March 1, 2017

March 1, 2017

Commodity Period Price Weekly Movement
Corn CBOT May 3.82  04 cents
Soybeans CBOT May 10.52  19 cents
Wheat CBOT May 4.57  01 cents
Wheat Minn. May 5.61  09 cents
Wheat Kansas May 4.77  06 cents
Chicago Oats May 2.46  06 cents
Canadian $ Mar 0.7494  0.99 points

Corn

Last week’s commentary suggested we would need a couple of weeks before we revisit our recent highs of February 16th. Although the May contract closed out the session on March 1st eight cents higher than the previous day, the chart formation still suggests another week or two before those levels challenged again. Corn found our $3.80 overhead resistance level too much for this rally but should still get to see another attempt in the coming weeks. Initial support is at the $3.60 level on May while overhead resistance is seen at $3.80 – $3.85.

Overall, the charts look positive in the long run but we have to expect pullbacks and it will take time to turn the trend positive. Our main downtrend line runs north of $4 on the lead month contract. Short term and weekly indicators are still positive, but the main trend is still down.

Soybeans

The trading range continues to narrow and soybeans are still range-bound between $10 – $11. We managed to stay above the $10 level on the close last week but pressure seems to be pushing hard on the $10 support line as we have received a short term sell signal. The March contract is now tied to cash and we have switched over to May. Short term indicators have turned negative this week, and the main trend is still down.

Wheat

Our reversal pattern worked as expected and we have completed a 50% pullback on the May wheat from the December 23 low and the more recent February 16 high. The pattern suggests more time before we challenge the February highs again, but unless we see prices close below the $4.40 based on the May contract, we could be ready for a challenge to the recent highs by mid-March. Looking ahead to next week, we see initial support on the May contract at the $4.40 level while overhead resistance is now at $4.65 also based on the May contract.

Both short and intermediate term indicators are still positive, but the primary trend is still down.

Harvest 2017 crop cash prices as of close on March 1, 2017
SWW @ $197.07 ($5.36/bu), HRW @ $197.07 ($5.36/bu),
HRS @ $221.09/MT ($6.02/bu), SRW @ $197.07 ($5.36/bu).

Grain Market Commentary for February 22, 2017

February 22, 2017

Commodity Period Price Weekly Movement
Corn CBOT March 3.70  09 cents
Soybeans CBOT March 10.22  38 cents
Wheat CBOT March 4.42  12 cents
Wheat Minn. March 5.43  25 cents
Wheat Kansas March 4.58  11 cents
Chicago Oats March 2.53  03 cents
Canadian $ March 0.7594  0.50 points

Corn

Corn found our $3.80 resistance level to be exactly that, resistance. After reaching $3.80 on the nose, we ended that particular session with a short term reversal pattern on our day chart. We will have to wait and see how much of a pullback we encounter. Initial support is at the $3.60 level on March and we could see that challenged quite quickly as we approach the first notice day for the March contract on Tuesday, February 28. Overall the charts look positive in the long run but we have to expect pullbacks and it will take time to turn the trend positive.

Our main downtrend line runs north of $4 on the lead month contract. Short term and weekly indicators are still positive, but the main trend is still down.

Soybeans

The trading range continues to narrow and soybeans will soon need to pick a direction. The pressure seems to favour a break below $10 but until we actually get the signal, we are only guessing. Currently, the range is between $10 and $11. Initial support is still at the $10 level on March, and strong overhead resistance is still around the $11 based on the lead month contract. We will be switching over to the May contract next week as the March contract will be transitioning to cash only. Indicators are mixed, but the main trend is still down.

Wheat

Last week saw our resistance met with a reversal pattern on our day charts. After hitting $4.64 on the March contract we ended up negative on the day and completed our head and shoulders pattern. From here, we are now correcting, and I expect this could take the a couple of weeks before we even attempt another shot at the recent highs. We will be switching over to the May contract next week. Meanwhile, the good news is that the daily and weekly indicators are still positive suggesting that our Labour Day weekend is still looking like the bottom and our red buy signal from Christmas is still intact.

Looking forward to next week we see initial support on the May contract at the $4.30 – $4.40 level while overhead resistance has now advanced to $4.80 also based on the May contract.

Both short and intermediate term indicators are still positive, but the primary trend is still down.

Harvest 2017 crop cash prices as of close on February 22, 2017
SWW @ $193.98 ($5.28/bu), HRW @ $193.98/MT ($5.28/bu),
HRS @ $214.29/MT ($5.83/bu), SRW @ $193.98/MT ($5.28/bu).