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
General Comments: Wheat markets were a little higher but traded higher during the session. The close was disappointing to bullish traders. Scattered showers were reported in west Texas over the weekend and more are in the forecast for this week. Minneapolis held better as dry conditions remain in the northern Great Plains and Canadian Prairies. A few showers are possible in these areas. Wheat remains a weather market, but the demand side has been weak. The weather remains too dry in the northern Great Plains and in the Canadian Prairies and farmers have planted into dry soils. Some showers are possible in both areas over the next week. It has been mostly dry in the southern Great Plains. The Great Plains should stay mostly dry or get scattered showers but some big rains are forecast for the southern Midwest over the next few days. Demand remains disappointing but the production might not be there for better demand in the coming year. Corn prices are high so demand for feed wheat could increase.
Overnight News: The southern Great Plains should get isolated showers. Temperatures should be near to below normal. Northern areas should see scattered showers. Temperatures will be near to below normal. The Canadian Prairies should see scattered showers. Temperatures should average below normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 712, 701, and 673 July, with resistance at 750, 769, and 776 July. Trends in Kansas City are mixed. Support is at 683, 667, and 661 July, with resistance at 706, 719, and 741 July. Trends in Minneapolis are mixed. Support is at 746, 724, and 710 July, and resistance is at 775, 780, and 786 July.
General Comments: Rice prices shot higher and made new highs for the move late in the session. Funds appeared to be the best buyers. The cash market is still slow but offers could start to increase from producers and elevators. The cash market has not felt any increased demand lately and mill operations are reported to be on the slow side. Texas and Louisiana are almost out of Rice, but there is Rice available in the other states, especially Arkansas. Asian and Mercosur markets were steady to lower last week. New crop months were a little lower. New crop Rice is almost completely planted in Texas and in Louisiana. Mississippi and Arkansas are actively planting around the rains.
Overnight News: The Delta should get some big rains. Temperatures should be near to above normal.
Chart Analysis: Trends are up with objectives of 1428 and 1479 July. Support is at 1389, 1380, and 1371 July, with resistance at 1424, 1436, and 1448 July.
DJ USDA World Market Rice Prices – May 5
USDA today announced the prevailing world market prices
of milled and rough rice, adjusted for U.S. milling yields
and location, and the resulting marketing loan gain (MLG)
and loan deficiency payment LDP) rates. Source: USDA
—–World Price—– MLG/LDP Rate
Milled Value Rough Rough
($/cwt) ($/cwt) ($/cwt)
Long Grain 17.76 11.36 0.00
Medium/Short Grain 17.38 11.61 0.00
Brokens 11.27 —- —-
CORN AND OATS:
General Comments: Corn closed higher as the market demonstrated more concern about the Safrinha crop production in Brazil than the rapid planting pace here in the Midwest. Western sections of the Midwest got crops planted with speed. Progress was less to the east. Temperatures will be cooler this week and there will be precipitation to keep farmers from the fields. Overall planting conditions should be fairly good over the next week. There are also concerns about the production potential for the Safrinha crop in Brazil as growing areas have been warm and dry and look to stay that way longer term. It is drier in central and parts of northern Brazil, and farmers have finally harvested the Soybeans area and planted the Winter Corn. The Winter Corn crop progress is well behind normal and it has been dry in major growing areas. There are worries that US Corn is priced out of the world market as US Corn is the highest price of any offering nation, but the lack of product4ion of the second crop in Brazil should mean stronger demand for US Corn. Demand for US Corn has been coming at a stronger pace than estimated by USDA and it looks like US ending stocks can be significantly less than current projections by the end of the year.
Overnight News: China cancelled purchases of 140,000 tons of US Corn. Mexico bought 184,100 tons of US Corn and unknown destinations bought 147,329 tons of US Corn.
Chart Analysis: Trends in Corn are up with objectives of 727 and 781 July. Support is at 674, 671, and 653 July, and resistance is at 704, 710, and 716 July. Trends in Oats are mixed. Support is at 400, 386, and 384 July, and resistance is at 414, 417, and 420 July.
General Comments: Soybeans and the products were higher but Soybeans got hurt by weaker demand ideas. Export demand has been softening for Soybeans for the last few weeks, but the US does not have that many left to sell. There is still crush demand and export demand even though the demand is less now than before and the market thinks the US is going to run out of Soybeans unless demand can be rationed with high prices. Some of that rationing is going on as US prices are much above offers from South America. The US does not have a lot of Soybeans in the country anymore as most producers have already sold. Buyers are scrambling for what is left. Brazil is rapidly exporting Soybeans. Harvest activities are done now. China has been buying for next year here but now is buying mostly in South America. US internal demand has been strong.
Chart Analysis: Trends in Soybeans are mixed. Support is at 1491, 1471, and 1448 July, and resistance is at 1563, 1575, and 1588 July. Trends in Soybean Meal are mixed to down with objectives of 410.00, 409.00, and 396.00 July. Support is at 415.00, 407.00, and 400.00 July, and resistance is at 424.00, 430.00, and 439.00 July. Trends in Soybean Oil are up with objectives of 6790 July. Support is at 6200, 5920, and 5850 July, with resistance at 6500, 6560, and 6600 July.
CANOLA AND PALM OIL
General Comments: Palm Oil closed a little lower on price action in the other competing markets. There is debate about the size of thre April stocks at this time. Export demand remains strong but might taper off over the rest of the month. Chicago price action was weak in overnight trading. Reports from Indonesia talked about higher production for the coming year. The market fears the loss of Indian demand due to the big Coronavirus outbreak there. Ideas of tight supplies are still around but MPOB did show higher than expected ending stocks in its March data. Ideas are that production can seasonally increase. Canola was sharply higher to limit up as prices reacted to a tight supply and demand scenario. Ideas of tight supplies combined with a drought in the Canadian Prairies supported the market but weaker demand ideas were bad for prices. Worries about South American production are supporting both markets as is cold and dry weather in the Prairies. Demand is thought to be great with crush margins favoring a lot of production of vegetable oils to feed the demand. The demand for bio fuels is about to increase and is one reason to see much stronger Soybean Oi and Canola prices.
Chart Analysis: Trends in Canola are up with objectives of 895.00 and 940.00 July. Support is at 850.00, 832.00, and 808.00 July, with resistance at 889500, 900.00, and 906.00 July. Trends in Palm Oil are mixed. Support is at 3970, 3910, and 3870 July, with resistance at 4090, 4280, and 4340 July.
Midwest Weather Forecast: Scattered showers. Temperatures should average below normal.
Questions? Ask Jack Scoville today at 312-264-4322