Today’s Prices

Grain markets finished mixed today with corn and wheat sharpy lower on Russia returning to the Ukrainian shipping deal.

Grain Market News

South American Precipitation Forecast

Week 1 has dry weather expected this week encompassing portions of western and southern Brazil.

Week 2 shows much better rains in the producing areas of Brazil but still questionable rains in Argentina.

Soil Moisture Change

As you can see all of Argentina’s producing areas expecting reduced soil moisture as well as Paraguay, Uruguay and much of western and southern Brazil.

The long-term forecast is indicating improved conditions towards the middle of November, but there are some concerns that la Nina could cause this pattern to continue.

GRACE

We mentioned we were not overly concerned about Brazil’s weather because they have adequate soil moisture.

The map on the left shows the Brazilian soil moisture is doing well in almost all areas while Argentina’s growing area drought conditions are clearly evident.

Grain Market News

60-Day Precipitation % of Normal

In the October crop report USDA projected corn and soybeans below trend partly due to challenges during the growing season.

But also, when we look at a 60-day % of normal precipitation we had extremely dry conditions in the northwestern belt and northern plains extending into the southern plains and delta.

7-Day Precipitation Forecast

The central portion of the belt is expecting some good rain from 1-2 inches of rain across Iowa, Missouri, Arkansas, down to the gulf coast.

Not only would this be good in helping recharge soil moisture but also help the Mississippi River levels.

Weekly Ethanol Production

Ethanol production hit a new marketing year high at 1.04 million barrels per day were produced last week.

As new crop corn is working its way into the pipeline, ethanol production has improved.

In fact, the last 2 weeks ethanol production has been above the level needed for the USDA.

Year to date ethanol production is down 3.4%, USDA is projecting it will be down 1%.

Weekly Stocks of Fuel Ethanol

Despite higher production, stocks of fuel ethanol did not increase.

They declined just fractionally; they are still up 10.4% from a year ago.

December Corn Chart

Corn prices exploded on Monday on Russia pulling out of the Ukrainian shipping deal and today the markets collapsed on talks that Russia is back in on the Ukrainian shipping deal.

We are right back to where we were at prior to Monday.

This leaves corn prices right back towards chart support where all the moving averages converge.

The market will be watching to see what happens with the current Ukrainian shipping agreement.

November Soybean Chart

Soybeans look good on the chart.

Protests and blockades leading to some of Brazil’s major ports has beans up as well as Argentina having drought conditions.

Technical indictors look good as well although they are now in the overbought range.

Overhead resistance is at 14.89, 14.84, 15.08 area. In order to get to this level, we need to have some bullish news.

December KC Wheat Chart

Wheat prices also exploded to the upside on Monday from the Russian news and collapsed to the downside today.

Wheat is now testing downside support on the chart.

Major chart support is in the lower $9 range.

Overhead resistance between 10.10-10.37 where we would consider making sales.

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