Markets are trading mixed this morning with beans falling back to test the upper end of the consolidation range we saw for much of March while corn is holding small gains. The U.S./China trade war appears to be intensifying again with China telling airlines to stop taking delivery of Boeing jets. Wheat is seeing follow-through to the downside on better-than-expected crop ratings.
Managed funds to start the week were estimated as net sellers of 5k corn to reduce the net long to 96k, net sellers of 2k beans to push the net short out to 7k, and net sellers of 4k wheat to push the net short out to 98k.
NOPA crush will be out at 11 with March crush expected to be197.6 mbu.
Crop progress showed corn planting 5% complete (6 expected), bean planting 2% (3 expected), spring wheat planted 7% (7 expected), and winter wheat rated 48% g/e (47 expected).
Ukrainian forecasters said recent cold weather has halted the development of winter crops and slowed spring seeding. Canola was the greatest impacted.
Sorghum exports, of which 90% typically go to China, have slowed recently, which will likely impact U.S. corn feed demand if what is typically exported must find another home. Sorghum area is expected to increase 4% year over year.
France raised their estimate for winter soft wheat area from 4.57 m ha to 4.61 m ha, which would be up 10% from a year ago.
Indian forecasters said they were likely to see above average monsoon rains for the 2nd consecutive year, which typically delivers 70% of their rainfall each year and has major implications for agriculture production.
ADM said they were shutting down domestic trading operations in China as part of a global cost-cutting push.
Brazil is on track to increase biodiesel blending rates from 14% to 15% after a recent drop in veg oil prices.
Corn traded an inside day to start the week with prices pulling back to test resistance turned support in the mid-to-low 4.80’s. The market is overbought after recent gains and is in need of a correction before the rally can likely continue. Support is 4.84 and 4.72 with resistance at 4.90.
Beans posted somewhat of a bearish Doji on Monday with prices pulling back overnight. The market is overbought with a potential bull-trap set after failing to see follow-through after breaking out to the upside of the recent range. May support is 10.30 then 10.00 with resistance at 10.50.
Corn pulled back to start the week but is holding above key support levels for now. Tight corn supplies in the U.S. and globally are supportive, but expectations for big U.S. corn area and trade concerns are negative. With the sharp rally that we saw over the last couple of weeks, producers should make sure sales are caught up and consider adding puts to protect unsold new crop corn.
Beans are under pressure overnight with news that China had instructed airlines to stop taking delivery of Boeing jets a potential sign that the trade war is going to pick up again. Regardless of any new developments there, we just saw beans rally 60-70 cents in the middle o fBrazilian harvest when global soybean supplies are record large. U.S. area is expected to shrink next year, but the recent rally is providing a selling opportunity for old crop beans. Producers should make sure sales are caught up and buy puts to protect unsold bushels.
Corn up 1-3
Beans down 5-9