Grains Report 01/28/2022

WHEAT 

General Comments:   Wheat markets closed lower again yesterday as tensions between the west and Russia eased and as Mr Putin said he would not do anything during the Olympics.  Futures were also lower on the stronger US Dollar.  The Dollar moved to new highs for the move and could now trade to 100.00 on the March Dollar Index.  Russia has been escalating the crisis to test US and NATO resolve and a war is now more likely or at least some severe sanctions that could end the export programs for both Russia and Ukraine.  The US and Russia are talking and Russia has said it will not do anything during the Olympics.  The weekly export sales report was strong and featured a markeing year high in sales.  It remains dry in the western Great Plains. Ideas had been that the US will have good demand for Wheat as the rest of the northern hemisphere is short production this year but so far demand has been average or less against previous years.  Offer volumes are down in Europe.  Dry weather in southern Russia as well as the US Great Plains and Canadian Prairies caused a lot less production.  The lack of production has reduced the offers and Russia has announced sales quotas.  Australian crop quality should be diminished.  North Africa is very dry.

Overnight News:  The southern Great Plains should get mostly dry conditions or isolated showers.  Temperatures should trend from below to above normal.  Northern areas should see isolated showers. Temperatures will trend from below to above normal.  The Canadian Prairies should see mostly dry conditions or isolated showers.  Temperatures should average above normal in the west and below normal in the east.

Chart Analysis:  Trends in Chicago are mixed.  Support is at 771, 758 and 747 March, with resistance at 803, 824, and 831 March.  Trends in Kansas City are mixed.  Support is at 786, 775, and 761 March, with resistance at 819, 829, and 849 March.  Trends in Minneapolis are mixed to down with objectives of 910 and 875 March.  Support is at 895, 871, and 853 March, and resistance is at 904, 930, and 945 March.

RICE:                                                 

General Comments:  Rice closed lower yesterday but trends are still mostly up in the market.  The US Dollar moved sharply higher and made new highs for the move.  It has the potential to trade to 100.00 on the Dollar Index.  The weekly export sales report showed much higher sales levels than previous weeks.  Futures and cash market trading have been quiet until now and the cash market is still quiet but domestic mill business is around everywhere.  Many producers are not interested in selling but some are selling the current crop and generating some needed revenue.  Mills are showing more interest in the market as previously bought supplies start to run low.  The cash market is reported to be relatively strong as prices have held firm and as activity increases.

Overnight News:  The Delta should get mostly dry conditions. Temperatures should be below normal.

Chart Analysis:  Trends are mixed to up with no objectives.  Support is at 1483, 1471, and 1466 March and resistance is at 1523, 1536, and 1550 March.

CORN AND OATS: 

General Comments:  Corn closed a little lower yesterday as the US Dollar moved sharply higher.  The Dollar moved to new highs for the move and could now trade to 100.00 on the March Dollar Index. The weekly export sales report showed strong demand for US Corn.  The markets heard about potential improvement in growing conditions in South America.  Central Argentina got the best rains again and the other areas were still dry or got significantly less rain.  Showers are now predicted for southern Brazil and the rest of Argentina and Paraguay and the situation there should become more stable.  Northern Brazil is expected to be drier to help with conditions there.  Ukraine is a major Corn and Wheat ex[porter and the market fears that a disruption in the export pace from there could mean more demand here.  Russia has eased tensions by indicating that nothing will happen until the Olympics end but the market is still watching.

Overnight News:  China bought 264,000 tons of US Soybeans and Mexico bought 141,514 tons of US Soybeans.

Chart Analysis:  Trends in Corn are up with objectives of 632 and 647 March.  Support is at 615, 611, and 604 March, and resistance is at 630, 636, and 642 March.  Trends in Oats are mixed.  Support is at 640, 616, and 601 March, and resistance is at 666, 677, and 680 March.

SOYBEANS 

General Comments:  Soybeans and the products closed higher on news that the Parana state Ag agency had drastically cut back nits production estimate for Soybeans in the state.  Yields were reduced and production was reduced by more than 5%.  Mato Grosso do Sul did the same thing yesterday.  The data implies total Brtazil production at 125 million tons to 127 million tons according to at least some analysts here in the US.  Production ideas at ther beginning of the crop season were closer to 150 million tons for Brazil so the cuts are drastic and imply much more demand for US Soybeans down the road.  Rains returned to dry soils in South America last week and are likely to continue this week. However, the benefits will be felt mostly in central Argentina and perhaps southern Argentina.  Showers are forecast for southern Brazil, Paraguay, and much of Argentina late this week.  There are ideas of better demand for US Soybeans due to the crop losses that Brazil and Argentina have already incurred due to the drought and due in part to the situation between Ukraine and Russia that could hurt agricultural and energy exports from both countries.  New demand is now thought to come from China as rumors of new business with that destination hit the floor.  China has now been a buyer for two days this week.  Trends are up on the daily and weekly charts.

Overnight News:   

Chart Analysis:  Trends in Soybeans are up with objectives of 1486 March.  Support is at 1430, 1414, and 1394 March, and resistance is at 1456, 1470, and 1482 March.  Trends in Soybean Meal are mixed to up with objectives of 417.00 and 444.00 March.   Support is at 396.00, 388.00, and 385.00 March, and resistance is at 410.00 415.00, and 420.00 March.  Trends in Soybean Oil are up with objectives of 6540 and 6790 March.  Support is at 6300, 6180, and 6120 March, with resistance at 6500, 6620, and 6740 March.

CANOLA AND PALM OIL 

General Comments:  Palm Oil was sharply higher yesterday in sympathy with the outside markets and on ideas of low supplies.  Short covering was noted.  Crude Oil was higher.  There are still poor production conditions in Malaysia and Indonesia.  Traders are mostly worried about demand from India who has been buying Soybean Oil in the US instead of Palm Oil from Malaysia and Indonesia and is also worried about China and its demand for Palm Oil for bio fuels.  Production conditions have been very poor and workers are not often in the fields.  Canola was higher in range trading.  Support came from the rally in Chicago.  Farmers are bullish and reluctant to sell because of the sharp reduction in Canola production in Canada this year.  The buy side thinks that Canola is fully priced but the farmers are still holding out for more.  Chart trends are mixed for the daily charts.

Overnight News:

Chart Analysis:  Trends in Canola are mixed.  Support is at 998.00, 983.00, and 977.00 March, with resistance at 1026.00, 1038.00, and 1040.00 March.  Trends in Palm Oil are up with objectives of 5530 and 5710 March.  Support is at 5290, 5040, and 4980 April, with resistance at 5560, 5680, and 5800 April.

Midwest Weather Forecast:   Mostly dry today.  Temperatures should average below normal..

US Gulf Cash Basis
	Corn	HRW	SRW	Soybeans	Soybean Meal	Soybean Oil
June	July	May	May	May
July	July		July	July
Augustg	July		July	July
				[JS1]

DJ ICE Canada Cash Grain Close – Jan 26 

     WINNIPEG — The following are the closing cash canola prices

from ICE Futures.

     Source: ICE Futures

1 Canada NCC Best Bid

                     Price     Basis     Contract     Change

CANOLA  

*Par Region          995.20     0.00     Mar. 2022    dn  0.70  

Basis: Thunder Bay  1042.50    45.00     Mar. 2022    up  2.30

Basis: Vancouver    1072.50    75.00     Mar. 2022    up  2.30

     All prices in Canadian dollars per metric tonne.

     *Quote for previous day

     Source: Commodity News Service Canada (news@marketsfarm.com,

or 204-414-9084)

DJ Malaysian PM Cash Market Prices for Palm Oil – January 28 

  The following are prices for Malaysian palm oil in the cash market at 1000 GMT Friday, supplied 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

Feb             1452.50    +50.00      Unquoted   –        –

Mar             1447.50    +55.00      Unquoted   –        –

Apr/May/Jun     1357.50    +40.00      Unquoted   –        –

Jul/Aug/Sep     1247.50    +35.00      Unquoted   –        –

RBD palm olein, FOB,     Malaysian ports

                 Offer      Change      Bid        Change   Traded

Feb              1455.00    +50.00      Unquoted   –        –

Mar              1450.00    +55.00      Unquoted   –        –

Apr/May/Jun      1360.00    +40.00      Unquoted   –        –

Jul/Aug/Sep      1250.00    +35.00      Unquoted   –        –

RBD palm stearin, FOB,  Malaysian ports

                 Offer      Change       Bid       Change   Traded

Feb              1445.00    +45.00       Unquoted  –        –

Palm Fatty Acid Distillate, FOB Malaysian ports

                 Offer       Change       Bid        Change   Traded

Feb              1345.00     +15.00       Unquoted   –        –

Crude palm oil, Delivered Basis, South Malaysia

                 Offer       Change        Bid        Change   Traded

Feb              5800.00     +160.00       Unquoted   –        –

Palm kernel oil, Delivered Basis, South Malaysia

                 Offer      Change         Bid        Change   Traded

Feb              606.00     +09.00         Unquoted   –        –

($1=MYR4.188)

DJ China Dalian Grain Futures Closing Prices, Volume – Jan 28 

Soybean No. 1

Turnover: 174,825 lots, or 10.89 billion yuan

            Open      High       Low     Close     Prev.    Settle       Ch.       Vol      Open

                                                  Settle                                Interest

Mar-22     6,222     6,288     6,191     6,216     6,191     6,246        55   139,173    79,154

May-22     6,180     6,227     6,163     6,182     6,160     6,193        33    22,420    25,860

Jul-22     6,138     6,180     6,100     6,125     6,112     6,137        25    12,253    50,396

Sep-22     6,117     6,140     6,071     6,081     6,083     6,112        29       670     3,419

Nov-22     6,059     6,098     6,030     6,054     6,051     6,066        15       265     5,328

Jan-23     6,033     6,033     6,001     6,001     6,001     6,012        11        44       160

Corn

Turnover: 544,305 lots, or 1.50 billion yuan

            Open      High       Low     Close     Prev.    Settle       Ch.       Vol        Open

                                                  Settle                                  Interest

Mar-22     2,728     2,741     2,717     2,722     2,730     2,729        -1    65,790     123,864

May-22     2,768     2,780     2,759     2,763     2,771     2,768        -3   423,918   1,161,813

Jul-22     2,772     2,783     2,765     2,770     2,772     2,772         0    23,616     144,951

Sep-22     2,780     2,782     2,763     2,767     2,771     2,772         1    25,552      91,868

Nov-22     2,721     2,731     2,705     2,707     2,721     2,719        -2     4,096      30,493

Jan-23     2,665     2,676     2,650     2,651     2,666     2,662        -4     1,333       5,284

Soymeal

Turnover: 1,143,827 lots, or 38.66 billion yuan

            Open      High       Low     Close     Prev.    Settle       Ch.       Vol        Open

                                                  Settle                                  Interest

Mar-22     3,542     3,572     3,535     3,560     3,513     3,554        41    70,918     101,526

May-22     3,358     3,393     3,345     3,378     3,323     3,367        44   863,987   1,238,750

Jul-22     3,340     3,374     3,333     3,360     3,305     3,350        45    42,260     237,220

Aug-22     3,364     3,420     3,364     3,403     3,343     3,394        51    24,549     122,975

Sep-22     3,370     3,414     3,368     3,395     3,335     3,388        53   116,455     318,667

Nov-22     3,359     3,393     3,352     3,370     3,309     3,371        62     8,269      59,009

Dec-22     3,333     3,345     3,313     3,329     3,299     3,331        32    10,394       8,572

Jan-23     3,270     3,282     3,252     3,270     3,239     3,264        25     6,995      23,271

Palm Oil

Turnover: 697,633 lots, or 68.88 billion yuan

            Open      High       Low     Close     Prev.    Settle       Ch.       Vol      Open

                                                  Settle                                Interest

Feb-22    10,832    11,112    10,832    11,070    10,762    11,042       280       737     2,874

Mar-22    10,494    10,692    10,486    10,648    10,402    10,570       168    31,989    37,919

Apr-22    10,166    10,342    10,154    10,280    10,084    10,210       126    18,227    56,871

May-22     9,774     9,956     9,774     9,934     9,696     9,858       162   606,948   468,416

Jun-22     9,486     9,662     9,486     9,626     9,402     9,556       154    19,684    64,358

Jul-22     9,292     9,442     9,290     9,412     9,206     9,360       154     9,375    22,978

Aug-22     9,292     9,292     9,156     9,218     9,060     9,204       144       486     1,443

Sep-22     8,930     9,098     8,924     9,098     8,856     9,010       154     9,992    26,377

Oct-22     8,946     8,964     8,852     8,930     8,736     8,906       170        40        69

Nov-22     8,762     8,772     8,762     8,772     8,632     8,768       136         5       943

Dec-22     8,676     8,722     8,676     8,722     8,478     8,698       220         2        41

Jan-23     8,542     8,674     8,504     8,606     8,434     8,576       142       148       413

Soybean Oil

Turnover: 689,507 lots, or 6.67 billion yuan

            Open      High       Low     Close     Prev.    Settle       Ch.       Vol      Open

                                                  Settle                                Interest

Mar-22     9,896    10,142     9,882    10,136     9,788     9,970       182    31,918    38,056

May-22     9,576     9,840     9,576     9,836     9,518     9,692       174   581,690   485,987

Jul-22     9,452     9,702     9,452     9,702     9,380     9,516       136    29,908   122,395

Aug-22     9,392     9,624     9,374     9,624     9,318     9,478       160    17,493    44,607

Sep-22     9,326     9,568     9,316     9,564     9,240     9,436       196    16,558    53,627

Nov-22     9,236     9,474     9,208     9,474     9,134     9,304       170     8,177     9,005

Dec-22     9,186     9,390     9,150     9,390     9,086     9,256       170     3,666       710

Jan-23     9,164     9,348     9,110     9,348     9,024     9,194       170        97       384

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