About The Author

Jack Scoville

Jack Scoville is an often quoted market analyst in the grain and soft commodities sectors. You will find his commentary throughout the Reuters, Wall Street Journal, Dow Jones, Bloomberg, and Barron's publications. Contact Mr. Scoville at (312) 264-4322

WHEAT
General Comments Winter Wheat markets were mostly higher on Monday. A meeting on Friday between the Russian government and exporters was supposed to reaffirm the agreement between the two to limit exports or face controls, but instead produced an announcement that exports could actually be a little larger for the year than previously agreed to. The move caused selling in the US and all three markets are now in short-term down trends on the weekly charts. However, world markets were firm to higher, so Wheat could respond with higher prices this week. The US market needs demand, and the weekly export sales report remain average at best. Ideas are that demand for US Wheat is about to improve, and the weekly charts show that higher prices possible in the next few weeks. World crop reports continue to indicate less production and tightening supplies. Firm prices extend from Russia to Australia on reduced world production, although Russia still shows the potential for strong exports this year. Australian and European prices have also been relatively strong. Argentine prices showed a little weakness last week as the weather in the country is about to turn drier and more favorable for the remaining Wheat crop to be harvested. The crop might have suffered some quality damage.
Overnight News: The southern Great Plains should get some precipitation starting on Wednesday, then a dry late week and weekend. Temperatures should be above normal. Northern areas should see precipitation mid-week, then drier weather. Temperatures should be near to above normal. The Canadian Prairies should see mostly dry conditions. Temperatures should be above normal.
Chart Analysis: Trends in Chicago are down with objectives of 508 March. Support is at 510, 504, and 500 March, with resistance at 520, 530, and 538 March. Trends in Kansas City are down with objectives of 498 March. Support is at 491, 485, and 483 March, with resistance at 508, 517, and 524 March. Trends in Minneapolis are down with no objectives. Support is at 561, 559, and 554 March, and resistance is at 568, 574, and 576 March.

RICE
General Comments: Rice was lower on Monday after trading higher early in the day. Weekly charts show the potential for a down trend, and the quiet tone in the cash market is reflected in the futures market as buyers and sellers are not eager to be involved. The holiday period is usually very quiet for the US cash market, and this year has seen a slow trade and stable prices. However, basis levels have been firming as the market needs a little Rice and is not getting much offer from the producers. Producers do not seem interested in further sales at this time. The export demand is holding relatively strong, and there is some mill demand. It will probably take until after the first of the year to see much movement in Rice futures and cash markets.
Overnight News: The Delta should get precipitation over the second half of the week. Temperatures should be mostly near to above normal.
Chart Analysis: Trends are mixed. Support is at 1037, 1035, and 1033 January, with resistance at 1064, 1069, and 1071 January.

CORN AND OATS
General Comments: Corn was a little lower on Monday. Trends are down short-term on the daily and up on weekly charts. The Corn market seems to found increased selling interest when prices get close to the 390 March area, and has failed now with the recent weakness in prices. Corn demand for ethanol has softened in the wake of the crushing move to lower prices over the last couple of months in petroleum futures markets. Ethanol prices have also weakened and blenders no longer have a profit margin and are cutting back on production. Export demand as noted in the USDA weekly sales reports represented a very strong week, and demand for US Corn in the world market and the domestic market is considered strong. The weather in the Midwest was somewhat better for harvesting as conditions were warm and dry early in the week. Wetter weather was noted in central and eastern areas late in the week. Cool, but quiet conditions are expected for much of this week, although significant precipitation is possible midweek from west to east. Planting progress in southern Brazil is reported to be ahead of the normal pace. Argentine planting progress is in line with its average pace.
Overnight News:
Chart Analysis: Trends in Corn are down with objectives of 374 and 366 March. Support is at 375, 372, and 370 March, and resistance is at 380, 384, and 387 March. Trends in Oats are down with objectives of 270 and 254 March. Support is at 273, 263, and 260 March, and resistance is at 280, 282, and 284 March.

SOYBEANS AND PRODUCTS
General Comments: Soybeans and products were mixed, with Soybeans a little lower on Monday. There is no new demand news with USDA shut down. The weekly export sales report was very strong in part to the first round of Chinese buying, and they bought more last week. The country might have bought 4.0 million tons in the last couple of weeks. China bought US Soybeans to fulfill its part of an agreement made in Buenos Aires, and it is expected to buy more in the next few weeks. However, the market knows that there are plenty of Soybeans to sell from the US and South America. Plus, there are no guarantees that the overall trade dispute will be resolved in the next three months, and the trade war could intensify if an agreement is not found. Brazil has been planting and plans on bigger crops. Argentina is also planting, but most of the trade attention is on Brazil. Producers in southern areas are ahead of the normal pace for planting progress, and there are reports of limited harvest activity in western Parana and in the Mato Grosso. Meanwhile, ending stocks projections for the US are very high and give little reason to expect a major rally anytime soon.
Overnight News:
Chart Analysis: Trends in Soybeans are down with objectives of 868, 843, and 837 January. Support is at 880, 871, and 864 January, and resistance is at 897, 900, and 903 January. Trends in Soybean Meal are mixed. Support is at 303.00, 300.00, and 297.00 January, and resistance is at 309.00, 312.00, and 315.00 January. Trends in Soybean Oil are down with objectives of 2780, 2760, and 2700 January. Support is at 2770, 2760, and 2740 January, with resistance at 2830, 2850, and 2880 January.

CANOLA AND PALM OIL
General Comments: Canola was lower along with Chicago. Some selling came on good weather in South America that is producing ideas of huge crops there. Commercials have plenty on hand for crushing or exporting. The daily charts show that futures are in a down trend. Palm Oil was a little lower on what appeared to be some long liquidation by speculators tied to weak demand. Weaker world vegetable oils prices were a drag on Palm Oil. The Malaysian government is looking at reducing its export taxes as a way to move Palm Oil.
Overnight News: AmSpec Agri said Malaysian Palm Oil exports are now 973,561 tons, from 1.039 million last month, IYS said that exports are now 1.015 million tons, from 1.041 million last month
Chart Analysis: Trends in Canola are down with objectives of 471.00 January. Support is at 472.00, 471.00, and 469.00 January, with resistance at 478.00, 481.00, and 483.00 January. Trends in Palm Oil are up with objectives of 2275 and 2400 March. Support is at 2140, 2130, and 2100 March, with resistance at 2200, 2220, and 2250 March.

Midwest Weather Forecast: Chances for big precipitation later in the week, then less precipitation over the weekend. Temperatures should be near to above normal.

US Gulf Cash Basis
Corn HRW SRW Soybeans Soybean Meal Soybean Oil
December 42 March 140 March 75 March 26 January 2 January
January 43 March 80 March 35 January
February 47 March 85 March 22 March
All basis levels are positive unless noted as negative

Brazil Premiums Soybeans Soybean Meal Soybean Oil Corn
Paraguay Paraguay Paraguay Santos
December
January
February -14 March

DJ ICE Canada Cash Grain Close – Dec 21
WINNIPEG–The following are the closing cash canola prices
from ICE Futures.
Source: ICE Futures
Price Change
CANOLA
*Par Region 464.36 dn 3.14
Basis: Thunder Bay
1 Can 494.70 dn 1.10
2 Can 481.70 dn 1.10
Basis: Vancouver
1 Can 506.70 dn 1.10
2 Can 493.70 dn 1.10
All prices in Canadian dollars per metric ton.
*Quote for previous day
Source: Commodity News Service Canada (cnscanada@shaw.ca,
204-414-9084)

DJ Malaysian PM Cash Market Prices for Palm Oil – Dec 26
The following are prices for Malaysian palm oil in the cash market at 1000 GMT Wednesday applied by commodity broker Matthes & Porton Bhd.
Prices are quoted in U.S. dollars a metric ton, except for crude palm oil and palm kernel oil, which are in ringgit a ton. Palm kernel oil prices are in ringgit a pikul, a Malaysian measurement equivalent to 60 kilograms.
Refined, bleached and deodorized palm oil, FOB, Malaysian ports
Offer Change Bid Change Traded
Jan 505.00 -02.50 Unquoted – –
Feb 525.00 -05.00 Unquoted – –
Mar 530.00 -07.50 Unquoted – –
Apr/May/Jun 542.50 -10.00 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Jan 510.00 -02.50 Unquoted – –
Feb 530.00 -05.00 Unquoted – –
Mar 535.00 -07.50 Unquoted – –
Apr/May/Jun 547.50 -10.00 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
Jan 487.50 -02.50 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
Jan 345.00 00.00 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Jan 2,020 -50.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Jan 190 -03.00 Unquoted – –
($1=MYR 4.1750)

DJ China Dalian Grain Futures Closing Prices, Volume – Dec 26
Soybean No. 1
Turnover: 102,692 lots, or 3.42 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jan-19 3,182 3,196 3,162 3,168 3,180 3,175 -5 24,084 53,654
Mar-19 3,180 3,234 3,180 3,234 3,221 3,217 -4 58 2,280
May-19 3,374 3,391 3,362 3,378 3,381 3,379 -2 76,190 158,478
Jul-19 – – – 3,479 3,479 3,479 0 0 8
Sep-19 3,442 3,450 3,430 3,443 3,441 3,443 2 2,212 11,556
Nov-19 – – – 3,483 3,495 3,483 -12 0 14
Jan-20 3,470 3,485 3,461 3,481 3,477 3,474 -3 148 1,170
Corn
Turnover: 531,198 lots, or 9.86 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jan-19 1,847 1,848 1,833 1,843 1,833 1,843 10 12,110 49,886
Mar-19 1,841 1,850 1,840 1,848 1,834 1,846 12 4,920 24,166
May-19 1,846 1,860 1,845 1,855 1,841 1,853 12 453,410 1,178,332
Jul-19 1,872 1,881 1,868 1,875 1,861 1,875 14 534 12,430
Sep-19 1,880 1,888 1,874 1,880 1,871 1,881 10 59,546 321,364
Nov-19 1,902 1,913 1,900 1,904 1,896 1,906 10 678 1,268
Soymeal
Turnover: 957,226 lots, or 25.47 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jan-19 2,854 2,856 2,803 2,810 2,850 2,834 -16 76,128 68,546
Mar-19 2,783 2,789 2,755 2,769 2,783 2,778 -5 66,208 151,206
May-19 2,632 2,641 2,621 2,634 2,631 2,632 1 758,264 1,470,724
Jul-19 2,630 2,640 2,623 2,636 2,632 2,632 0 1,802 8,374
Aug-19 – – – 2,654 2,654 2,654 0 0 262
Sep-19 2,672 2,682 2,663 2,676 2,674 2,674 0 54,212 363,760
Nov-19 2,687 2,694 2,682 2,691 2,687 2,689 2 592 1,272
Dec-19 2,712 2,727 2,701 2,704 2,690 2,711 21 20 22
Palm Oil
Turnover: 216,484 lots, or 9.63 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jan-19 4,070 4,092 4,042 4,054 4,102 4,064 -38 22,796 41,504
Feb-19 – – – 4,272 4,310 4,272 -38 0 30
Mar-19 4,388 4,390 4,388 4,390 4,350 4,388 38 12 14
Apr-19 – – – 4,484 4,484 4,484 0 0 18
May-19 4,480 4,508 4,476 4,498 4,504 4,490 -14 183,424 427,954
Jun-19 4,558 4,592 4,540 4,552 4,490 4,562 72 314 54
Jul-19 4,612 4,636 4,612 4,636 4,638 4,618 -20 12 24
Aug-19 – – – 4,662 4,662 4,662 0 0 2
Sep-19 4,558 4,582 4,550 4,570 4,578 4,566 -12 9,902 49,990
Oct-19 4,644 4,644 4,642 4,642 4,670 4,642 -28 10 26
Nov-19 4,636 4,658 4,636 4,656 4,644 4,644 0 14 10
Dec-19 – – – 4,636 4,636 4,636 0 0 0
Soybean Oil
Turnover: 280,618 lots, or 15.04 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jan-19 4,928 4,962 4,902 4,924 4,988 4,926 -62 30,852 67,228
Mar-19 5,098 5,098 5,010 5,010 5,076 5,040 -36 30 178
May-19 5,402 5,424 5,380 5,410 5,428 5,402 -26 228,532 644,812
Jul-19 5,420 5,420 5,420 5,420 5,476 5,420 -56 6 20
Aug-19 – – – 5,496 5,496 5,496 0 0 2
Sep-19 5,496 5,518 5,474 5,502 5,518 5,500 -18 21,196 93,316
Nov-19 – – – 5,538 5,538 5,538 0 0 4
Dec-19 5,626 5,626 5,626 5,626 5,584 5,626 42 2 8
Notes:
1) Unit is Chinese yuan a metric ton;
2) Ch. is day’s settlement minus previous settlement;
3) Volume and open interest are in lots;
4) One lot is equivalent to 10 metric tons.

Questions? Ask Jack Scoville today at 312-264-4322