Grains and oilseeds are mixed on Tuesday ahead of the USDA’s supply and demand report. The U.S. dollar is higher. Crude oil is steady. Stock futures are steady to lower.
CORN
March corn is up 0.75 cents at $4.44 ½. New crop December corn is up 0.75 cents at $4.64 ¾.
Futures maintained their sideways consolidation pattern after the March contract traded 1 cent lower. Prices are trading in the middle of a range between $4.35 and $4.57.
Today’s WASDE is expected to show slightly lower U.S. corn ending stocks. However, the supply and demand situation remains burdensome as record production is expected to overshadow strong demand.
The export forecast could get a slight boost just based on pace data.
President Trump is threatening to impose tariffs on Canadian fertilizer imports to boost domestic production. Canada accounts for 88 percent of U.S. potash imports. Limited supply chain disruptions have kept potash as one of the most affordable nutrients.
SOYBEANS
January soybeans are down 4.75 cents at $10.89. New crop November soybeans are down 3 cents at $10.98 ½. Soybean oil is lower. Soybean meal is sharply lower.
Futures extended losses on Monday after the January contract lost 11.50 cents. Weak price action continued in the overnight session, with a test of the gap between $10.63 and $10.70 seems more likely. Soybean meal prices remain the weakest in the soy complex.
A wetter outlook for Brazil helped pressure the soybean complex to start this week. Planting and crop establishment seems to be going well.
Ahead of today’s WASDE, the trade is expecting an upward adjustment to the U.S. soybean ending stocks forecast.
Argentina’s government reduced its export tax for some agricultural commodities, including soybeans and soybean products. Last time the country lowered export taxes, China bought unprecedented volumes of Argentinian soybeans.
WHEAT
March Chicago wheat is down 2.50 cents at $5.32 ¼. KC wheat is down 1.50 cents at $5.25. Spring wheat is up 2 cents at $5.73 ¼.
Wheat futures have struggled to find buyers for the past couple of weeks. Chicago wheat is testing the lower end of its consolidation range ahead of today’s WASDE report.
Pre-report expectations predict slightly lower U.S. ending stocks following last month’s boost. It’s possible the USDA will also raise global supplies due to strong estimates out of Canada last week.
Argentina’s export tax reduction includes wheat, which could help drive farmer selling in the country and pressure global prices.
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PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. FUTURES TRADING INVOLVES SUBSTANTIAL RISK AND IS NOT SUITABLE FOR ALL INVESTORS.