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Today’s Prices
Grain prices finished sharply mixed as different fundamental news is coming in to either support or pull lower the different grain.
Grain Market News
3-Day Snowfall Forecast
This map shows the 3-day snowfall forecast for Monday-Wednesday. A foot or more could fall in central US and up into the eastern corn belt. Even in the central and Western plains could see 4-6 inches of snow. Not a drought breaker, but they will take any moisture they can get.
7-Day Precipitation Forecast
Combined the rain and melted snow, quarter to a half inch of rain in the central and western plains. This is certainly beneficial to the crop but wouldn’t change the overall drought scenario.
Grain Market News
Argentina Cumulative Precipitation vs. Normal
From late December to about mid-January the bottom line did not go up. So, this means they did not get much precipitation in Argentina’s main grain belt. You can see we went from fairly normal precipitation for the year to date back in mid-December to being well behind the normal precipitation by mid-January.
Observed Surface High Temps
Temperatures have moderated from previous seen extreme temperatures. Highlighting Argentina’s growing area, mostly upper 80s and low 90s for yesterdays high. Then mostly 80s with a few upper 70s in the heart of Brazil’s growing area. Any heat that remains is primarily centered on eastern Paraguay.
South America 2-week Precipitation forecast
Over the next 2 weeks Argentina could start to see another dry spell in effect. While southern Brazil and Paraguay may see scattered rainfall. Looking at the second week, going into mid-February, Argentina could still remain with less than desired rainfall while there is decent opportunity for rainfall in southern Brazil and Paraguay.
Temperature Anomaly
In addition to the potential more rainfall, temperatures are not expected to be extreme. Argentina is expected to be slightly below average temperatures in the south, slightly above in the north, while in Brazil slightly below normal in north and slightly above normal in south. Overall, we viewed South Americas weather at the time as a mixed influence. Not extremely harmful but also not ideal.
Corn: Weekly Export Inspections
Corn was down from last week at 40,775 million bushels. that’s below level needed which s slightly disappointing for corn today. We expect the long-term trend for exports to increase. We do believe we see a lot of numbers above the level needed as we get into late February through June timeframe. Due to the large amount of corn already on the books in the US and additional exports due to losses in South America. At this time, we believe corn exports will not have a problem reaching USDA’s current estimate and maybe could exceed it if we see big exports for an extended period of time in late Spring early Summer.
Soybeans: Weekly Export Inspections
Inspections are quite good at 51,860 million bushels, well over double the level needed to reach USDAs forecast. With production losses in South America, we expect that US exports will be better than normal in the June, July, and August timeframe. That should get exports above the black line late in the Summer. We believe it is likely that US exports will reach USDA’s forecast and likely exceed the forecast for beans since we are already above the forecasted number.
Wheat: Weekly Export Inspections
Consistently above needed level back in July, august, sept, below level in October, November, December, and into January. Bottom line is the USDA is projecting exports to be down 16.8%, exports here today are fairly close to that at down 18%. We are expecting exports to improve for wheat and likely will end up with exports fairly close to USDA’s projection.
March Corn Chart
Corn prices exploded at a new high at 6.42 taking out the highs from last May. But it was a disappointing close after being sharply higher early in the day as nearby corn closed sharply lower. It was a reversal down day with closing prices ending at 6.26 which was 16 cents off the daily high. Today’s poor performance did turn the technical indicators down again which means we have to respect the fact that corn prices could want to retest where the 20 and 40-day averages come in to play and our uptrend line in the low 6-dollar range. This is another 20-25 cents below what we closed at today. The overall trend is still an uptrend it’s just the chart and technical are hinting at the potential for a correction.
March Soybean Chart
Soybeans were sharply higher and closed sharply higher pushing close to the $15 level and making new contract highs. Rallied a dollar in a weeks’ time and when you rally this sharply you are always subject to having corrections and setbacks. Right now, if beans would set back on a correction. we could pull down into the 14.20-14.25 range and that could be another 50-60 cents lower than where we closed today. We still see the trend pointing upwards, with no signs of topping in the charts and no signs of topping in the technical but technicals are well into the overbought range. Beans certainly have room for a correction with a little negative news.
March KC Wheat Chart
As bullish as beans look on a chart the wheat is looking negative on a chart. After rallying over a dollar in a weeks’ time, wheat has now fallen 72 cents in 4 days. Recent action in the wheat market continues to trend at extremely volatile and big moves in the wheat market. Long term we are in a pennant formation, lower highs being posted, and higher lows being posted. Leaving us right in the middle of our pennant formation. But todays close was disappointing as the chart and the technical pointed lower. That tells us, at least in the near term, charts and technical indicators that this market may want to test for chart support down in the low 60s, about 15 cents below where we closed today.
Questions or Comments
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