Grains and oilseeds are mixed on Thursday morning following the overnight session. The U.S. dollar is higher. Crude oil is sharply higher after prices rebounded on Wednesday. Stock futures are lower.
CORN
The most active May corn contract traded 4.50 cents higher on Wednesday to 4.67 ¼, posting the strongest day in a few sessions. The contract found support just below $4.60 again before moving higher yesterday.
Sharply higher soybean prices and rising crude helped support corn yesterday. The current uptrend remains intact, with a test of the March highs likely.
Bloomberg should have its pre-report estimates out later today ahead of the USDA’s Quarterly Grain Stocks and Prospective Plantings report on Tuesday. It’s becoming more likely that soybeans were able to buy more acres from corn since February.
Input costs are undoubtedly high, with fertilizer and crop ratios showing diminishing affordability for nitrogen use in corn.
U.S. ethanol production jumped 2.1 percent higher last week to an average of 1.116 million barrels a day, holding well above seasonal levels. The estimated corn crushed for ethanol production was about 109.4 million bushels. Cumulative crushings for the marketing year reached approximately 3.112 billion bushels, reaching 55.6 percent of the USDA’s target.
SOYBEANS
Soybeans caught a late-session bid on Wednesday, boosting May futures 16.75 cents higher to close at $11.71 ¾. That was the strongest daily gain since March 6.
Prices are currently testing resistance at the November high around $11.78. Clearing that level could encourage bulls ahead of key biofuel policy announcements.
News that the meeting between President Trump and President Xi is back on helped soybean prices surge late in the session on Wednesday. Originally, the meeting had been delayed due to the ongoing conflict between the U.S. and Iran.
The chokehold on global energy flows could add leverage for trade talks and China’s lackluster purchases of U.S. soybeans. China is confirmed to have only about 10 MMT of U.S. soybean commitments on the books for the current marketing year.
WHEAT
KC wheat led the wheat complex higher on Wednesday after gaining 13.75 cents to close at $6.17 ¾. Chicago wheat posted similar gains of 7.75 cents but found resistance around $6 a bushel.
Chicago futures successfully held support around a breakout area so far this week. Wheat technicals could become more positive as weather continues to build a story for the wheat market.
Hard red winter wheat traded at its highest premium to Chicago in about a year, likely due to production concerns in the HRW wheat belt. Crop conditions have deteriorated in the past month due to growing moisture deficits.
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PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. FUTURES TRADING INVOLVES SUBSTANTIAL RISK AND IS NOT SUITABLE FOR ALL INVESTORS.