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The Grain Report - START DRY- END WET.

START DRY- END WET......................... First things first. Let's address demand. Thursday's weekly export sales report showed 265,000 metric tons of wheat was sold last week, up 97% from the week prior, but down 19% on the four-week average. No premier players were on the list out the Middle East or Asia. The weekly surge is discounted by traders as the week prior low sales were among the years lowest. With ending stocks come wheats new marketing year June 1 at 839 m.b. no one is worried about running out. Wheat keeps all eyes on weather and its impact on winter and spring wheat planting for pricing direction. Corn exports were 349,000 metric tons down 43% from the week prior and 65% under our four-week average and down for the second consecutive week after making new price highs for the year. This lends to talk in the trade that recent historic high prices may have importers stepping back a little. In the big picture cattle and hog's feeders are still making a profit as well as ethanol producers all willing to buy corn at today's prices, but foreign ports are pausing and that's not unusual after that price surge to new highs. Bean exports were soft at 143,000 metric tons down 59% from the week prior and 65% under the four-week average. China was absent from the list. China continues its recent trend of buying more near-term needs from Brazil now as 93% of their crop is harvested and selling their beans at a discount to any US posted price. China's continuing to purchases near-term to new crop season delivery after September one. This helps the US keep ending stocks from old crop stored from declining but it sets up 2012 ending stocks eventually come in lower than 2011. Classic week we saw. Grains traded higher Sunday and Monday pricing in the weeks wet weather not allowing farmers to plant. The rally was followed by profit-taking Tuesday and Wednesday. This was the third consecutive week where we were higher Sunday and Monday pricing in wet weather and planting delays and down Tuesday and Wednesday. But Thursday to saw lower prices on another front. I noted on last weeks weekend grain report and Tuesday's report this week that profit-taking breaks this week could be greater as this is the end of the month and funds can pay bonuses on profits taken before month-end. This always have funds being much more aggressive on long liquidation. We saw on Monday and Thursday funds sell aggressively their silver trades on rallies and crude oil positions. Soft commodities like cocoa and sugar much of the same. So we shouldn't be surprised on grains pullback being deeper than the two prior weeks. How's the weather. Here's how WXRISK.com sees next week. Saturday through Wednesday sees the upper planes and Western corn belt with only .50 to.75 inches of rain with 50% coverage. This will allow some planting of spring wheat and corn but not much. The Eastern grain belt of Illinois, Indiana and Ohio much wetter with 70% coverage .50 to 2 inches. Eastern corn belt is always planted last while the Western corn belt and upper planes first. Then may 5 to 7 or beginning Thursday next week there's a chance for another big ring system across the entire grain belt. If this occurs planting falls behind again. There's another wet system for may 11 and 12. Long-term forecast can change so be on top of forecasting. If next weeks rains May 5 to 7 get taken out of the forecast. Then the planting window opens wide. This could see corn pullback to 6.06 on December and 6.93 on May futures. November beans futures could see 12.90. Should these rains come in and confirmation of the may 11 and 12 event were looking at a corn backup to 7.68 and December 6 .80 with November beans in tow. Until June 1 when crop should be in it's all about the next forecast and its impact on planting. On Friday mornings weather update it appears nightly temperatures in the low 30s in the Western corn belt and upper planes are certain. These are nightly lows. Ground temperatures will remain far too cold for seeds to spout if planted, so this may have farmers wait for warmer temperatures. Seed in the ground for two weeks and not sprouting usually needs replanting. We should trade higher Sunday and Monday on the foreseeing wet forecast and Monday's report on corn and spring wheat planting progress being bullish, then profit-taking again Tuesday and Wednesday. Profit-taking should not to be as deep as the this week as traders will see the late week rain in front of them and will be thinking about buying into the USDA crop report the week after. Technicals read like this. July corn support is 7.30 then 7.00. Resistance is 7.72. December support at 6.26 then 6.06. Resistance 6.80. July beans support is 13.35 and resistance 13.90 then 14.30. November beans support 13.25 then 12.90. Resistance is 14.00. July wheat support is 7.60 resistance 8.10. A close over and 8.65 is next.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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