Grain Market Commentary for March 22, 2017

March 22, 2017

Commodity Period Price Weekly Movement
Corn CBOT May 3.58  05 cents
Soybeans CBOT May 9.98  00 cents
Wheat CBOT May 4.21  15 cents
Wheat Minn. May 5.38  02 cents
Wheat Kansas May 4.31  15 cents
Chicago Oats May 2.52  05 cents
Canadian $ June 0.7510  0.00 points

Corn

As indicated in last week’s commentary, a correction is underway in the May contract after receiving a red sell signal on March 10. Tuesday, February 28 marked the highs of the recent run-up, and since then we continue to probe the downside for solid support before we attempt another challenge of those highs. Our first good support line is around the $3.50 level on the May contract while our major overhead resistance level is around $4.

Short term indicators are negative and the main trend is still down.

Soybeans

Repeating again from the last two weeks, our red sell signal from February 22 is still intact, and the May contract has now dropped forty cents to date. Our six month old up-trend line still remains under attack as the May contract refuses to make any significant closes below the $10 support level. This looks like just a matter of time as the downward pressure continues on all of the grains. Our May contract needs to stay above $9.85 on a close basis or risk a possible test of the $9.50 support area from last summer.

Short term indicators are negative and the main trend is still down.

Wheat

Our key reversal from February 16 is behaving as expected. That rally took us temporarily through the $4.65 down-trend line before closing that day with a strong reversal. Since then we have been in a corrective mode. A red sell signal on March 13 confirmed this correction is still ongoing. At this point I feel a close below $4.20 on the May contract would suggest a strong possibility of a retest of the May contract lows of $4.05.

Short term indicators are still negative and the primary trend is still down.

Harvest 2016 crop cash prices as of close on March 22, 2017
SWW @ $199.32/MT ($5.42/bu), HRW @ $199.32/MT ($5.42/bu),
HRS @ $229.92/MT ($6.26/bu), SRW @ $199.32/MT ($5.42/bu).

Grain Market Commentary for March 15, 2017

March 15, 2017

Commodity Period Price Weekly Movement
Corn CBOT May 3.63  09 cents
Soybeans CBOT May 9.98  13 cents
Wheat CBOT May 4.36  11 cents
Wheat Minn. May 5.40  09 cents
Wheat Kansas May 4.47  19 cents
Chicago Oats May 2.57  13 cents
Canadian $ June 0.7510  0.75 points

Corn

The March contract is now expired leaving May as the lead month. A pullback is evident as we see prices ready to test our support levels after receiving a red sell signal on the short term indicators after the USDA report. First support on the May contract is seen at $3.50 and again each ten cents lower until support is found. A rally from this level could move us back toward the $3.70 – $3.75 overhead resistance. Our major trend-line is still around the $4.00 mark and it’s this line that we need to negate before we can get this market to turn positive in the long term. Repeating last week’s outlook, a pullback of a larger scale could see the May contract challenge the $3.40 and possibly even the $3.30 support levels. Short term indicators are neutral, but the main trend is still down.

Soybeans

Our red sell signal from February 22 is still intact and the May contract has dropped thirty cents to date. More of a concern is our one year old trend-line which is our major support and it needs to stay above $9.85 on a close basis. The May contract will probably continue to find downward pressure if so, there is a chance we could see much lower prices coming into the spring on the lead month contract. Short term indicators have all turned negative as indicated in last week’s commentary and the main trend is still down.

Wheat

With the March contract expiring March 14, there seems to be some temporary relief from downward pressure on prices. While still in a corrective mode we are now due for a bounce. Initially we have overhead resistance at the $4.40 – $4.45 level on May. The short term indicator flashed a sell signal this week suggesting this pullback could see lower prices in the coming weeks.

Short term indicators are now negative and the primary trend is still down.

Harvest 2017 crop cash prices as of close on March 15, 2017
SWW @ $205.96/MT ($5.61/bu), HRW @ $205.96/MT ($5.61/bu),
HRS @ $230.90/MT ($6.28/bu), SRW @ $205.96/MT ($5.61/bu).

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).