Grains Report 03/22/2023

WHEAT
General Comments: Wheat markets were lower yesterday on follow through selling as the world banking crisis s easing and as negotiations with Russia to extend the grain corridor deal with Ukraine were completed with a 60 day extension of the current agreement. Reports say that Russian offers continue to hit the world market and world prices. Trends turned sideways to up on the daily charts but remain down on the weekly charts. The problem remains demand as world supplies are not so large and US inventories are less. Ideas that big Russian offers and cheaper Russian prices would be a feature for a while in the world market was the driving force for the weaker prices, and price weakness could continue. Ideas are that both Australia and Russia are harvesting record to near record Wheat crops this year. The demand for US Wheat in international markets has been a disappointment all year and has been hindered by low prices and aggressive offers from Russia.
Overnight News: The southern Great Plains should get isolated showers. Temperatures should be near to below normal. Northern areas should see isolated showers. Temperatures will average below normal. The Canadian Prairies should see isolated snow showers. Temperatures should average below normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 661, 654, and 648 May, with resistance at 697, 712, and 728 May. Trends in Kansas City are mixed. Support is at 809, 804, and 773 May, with resistance at 837, 853, and 862 May. Trends in Minneapolis are mixed. Support is at 840, 831, and 814 March, and resistance is at 862, 869, and 880 May.

RICE:
General Comments: Rice was a little lower yesterday and trends are still up on the charts. It was a consolidation day yesterday but the price action is still positive for prices. Demand has been good from domestic sources and offers seem hard to find right now. Export demand has been uneven but was a marketing year high in the most recent weekly export sales report. Demand has been an issue for the market all year. There is not much going on in the domestic market right now although mills are milling for the domestic market in Arkansas and are bidding for some Rice. Markets from Texas to Mississippi are called quiet. Demand in general has been slow to moderate for Rice for exports. Planting is active in Texas and southern Louisiana.
Overnight News: The Delta should get isolated showers. Temperatures should be below normal.
Chart Analysis: Trends are up with no objectives. Support is at 1714, 1695, and 1665 May and resistance is at 1749, 1762, and 1772.

DJ USDA World Market Rice Prices – Mar 22
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) ($/cwt)
Long Grain 18.45 11.30 0.00
Medium/Short Grain 18.22 11.99 0.00
Brokens 10.73 —- —-
This week’s prevailing world market prices and MLG/LDP
rates are based on the following U.S. milling yields and
the corresponding loan rates:
U.S. Milling Yields Loan Rate
Whole/Broken ($/cwt)
(lbs/cwt)
Long Grain 50.62/18.25 6.81
Medium Grain/Short Grain 60.20/9.50 6.93

CORN AND OATS
General Comments: Corn closed a little lower yesterday along with other ag markets. Oats were higher and trends remain up in this market. US prices are currently very competitive with those from South America as Brazil concentrates on Soybeans exports and not Corn and US demand could improve because of the price differentials. Prices from South America should now remain strong as countries there concentrate on Soybeans exports, so the US has a chance now to see export demand improve. The Brazil Summer crop and the Argentine crop is developing under stressful conditions. It has been wet so the Soybeans harvest has been delayed and the Safrinha Corn planting is becoming delayed as well. These delays continue. Brazil sources say that 20% of the Winter crop could be planted outside of the ideal window so yields could be hurt in the end. NOAA is forecasting that La Nina will develop this Summer and replace El Nino. US growing conditions are usually good when this happens.
Overnight News: China bought 178,000 tons of US Corn
Chart Analysis: Trends in Corn are mixed to up with objectives of 651 May. Support is at 625, 622, and 619 May, and resistance is at 639, 645, and 648 May. Trends in Oats are up with objectives of 371 May. Support is at 353, 349, and 343 May, and resistance is at 372, 378, and 382 May.

SOYBEANS
General Comments: Soybeans were lower and Soybean Meal were mixed, with nearby months lower as the Brazil harvest makes it way slowly to the market. Soybean Oil was lower but held to a trading range. Reports from Brazil show that basis levels there are under pressure due to the large crop being harvested now. However, the basis might get higher soon as total South American production is probably about the same as last year. Brazil has a very good crop, but the additional Soybeans grown in Brazil will be wiped out by the losses in Argentina. Forecasts from NOAA for very good growing conditions in the Midwest were also a factor. Soybeans export demand is flowing to Brazil now. Argentina is the world’s largest exporter of Soybeans products while the US and Brazil battle for supremacy in Soybeans exports. It remains hot and dry in Argentina and crop conditions are getting worse. Production ideas there are still dropping and the Rosario exchange now estimates production near 27 million tons. The Buenos Aires Grain Exchange said production could be between 25 and 27 million tons. Weather is becoming less important now as the harvest is already underway in central and northern Brazil and will spread south soon. Central and northern Brazil have seen harvest operations interrupted with too much rain. Production potential for the Brazil is called very strong even with potential problems and losses in the south. Argentine production ideas continue to drop with the drought as planting is delayed and the crops already in the ground are stressed.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed to down with objectives of 1458 and 1408 May. Support is at 1462, 1458 and 1439 May, and resistance is at 1500, 1516, and 1532 May. Trends in Soybean Meal are down with objectives of 446.00 May. Support is at 457.00, 447.00, and 442.00 May, and resistance is at 475.00, 485.00, and 490.00 May. Trends in Soybean Oil are mixed. Support is at 5610, 5540, and 5510 May, with resistance at 5850, 5980, and 6050 May.

GAIN
General Comments: Palm Oil closed lower today on weakness in Chicago and despite demand concerns and on ideas are that prices can remain elevated due to bad weather in Malaysia and the potential for increased demand from India and especially China. Indonesia is now revoking some export permits to keep internal prices controlled and to support the bio fuels industry. The controls are expected to last through Ramadan. Peninsular Malaysia is getting flooding rains. Flash floods are being reported. Canola was much lower again yesterday and trends are down. Brazil is expected to dominate the oilseeds market for the next few months. Reports indicate that domestic demand has been strong due to favorable crush margins. Production was much improved this year on better weather during last Summer. It is dry in the southern and southwestern prairies now and this could mean reduced yields when the production season begins in a couple of months.
Overnight News:
Chart Analysis: Trends in Canola are down with no objectives. Support is at 722.00, 716.00, and 710.00 May, with resistance at 741.00, 761.00, and 767.00 May. Trends in Palm Oil are down with no objectives. Support is at 3770, 3750, and 3720 June, with resistance at 3900, 3990, and 4050 June.

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

US Gulf Cash Basis

Corn HRW SRW Soybeans Soybean Meal Soybean Oil
March
115 May
175 May
115 May
110 May

April
115 May
175 May
115 May
1010 May

May
100 May
175 May 100 May
107 May

DJ ICE Canada Cash Grain Close – Mar 21
WINNIPEG — The following are the closing cash
canola prices from ICE Futures.
Source: ICE Futures
Price Basis Contract Change
CANOLA
*Par Region 738.60 0.00 May 2023 dn 13.00
Track Thunder Bay 759.40 30.00 May 2023 dn 9.20
Track Vancouver 797.40 68.00 May 2023 dn 9.20
All prices in Canadian dollars per metric tonne.
*Quote for previous day
Source: MarketsFarm (news@marketsfarm.com,
204-414-9084, or cell 204-782-5944)

DJ Malaysian PM Cash Market Prices for Palm Oil – March 22
The following are prices for Malaysian palm oil in the cash market at 1000 GMT Wednesday, 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
Apr 930.00 -17.50 Unquoted – –
May 905.00 -25.00 Unquoted – –
Jun 885.00 -30.00 Unquoted – –
Jul/Aug/Sep 855.00 -20.00 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Offer Change Bid Change Traded
Apr 940.00 -17.50 Unquoted – –
May 915.00 -25.00 Unquoted – –
Jun 895.00 -30.00 Unquoted – –
Jul/Aug/Sep 865.00 -20.00 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
Apr 900.00 -15.00 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
Apr 700.00 -15.00 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Apr 4000.00 +100.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Apr 242.00 -03.00 Unquoted – –
($1=MYR4.448)

DJ China Dalian Grain Futures Closing Prices, Volume – Mar 22
Soybean No. 1
Turnover: 142,970 lots, or 7.71 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
May-23 5,454 5,477 5,391 5,464 5,427 5,427 0 96,762 101,211
Jul-23 5,337 5,376 5,315 5,364 5,341 5,339 -2 25,992 68,540
Sep-23 5,320 5,340 5,287 5,329 5,313 5,309 -4 2,394 6,604
Nov-23 5,285 5,311 5,261 5,275 5,289 5,279 -10 13,577 36,922
Jan-24 5,269 5,297 5,243 5,285 5,264 5,270 6 107 718
Mar-24 5,271 5,279 5,225 5,268 5,264 5,246 -18 4,138 3,742
Corn
Turnover: 1,035,611 lots, or 28.55 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
May-23 2,785 2,794 2,754 2,768 2,807 2,770 -37 476,306 616,238
Jul-23 2,773 2,782 2,750 2,764 2,791 2,763 -28 375,046 683,314
Sep-23 2,752 2,764 2,740 2,752 2,768 2,750 -18 48,623 150,436
Nov-23 2,795 2,795 2,677 2,695 2,707 2,688 -19 131,444 250,124
Jan-24 2,698 2,702 2,679 2,688 2,706 2,686 -20 3,853 13,897
Mar-24 2,700 2,703 2,673 2,679 2,701 2,681 -20 339 477
Soymeal
Turnover: 1,171,191 lots, or 4.25 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
May-23 3,663 3,669 3,570 3,602 3,626 3,610 -16 710,231 998,363
Jul-23 3,690 3,690 3,583 3,618 3,637 3,623 -14 49,811 213,252
Aug-23 3,717 3,731 3,645 3,676 3,688 3,681 -7 46,296 148,423
Sep-23 3,715 3,720 3,630 3,661 3,685 3,665 -20 249,866 616,498
Nov-23 3,699 3,702 3,612 3,642 3,667 3,650 -17 59,400 75,211
Dec-23 3,654 3,664 3,581 3,608 3,634 3,614 -20 25,388 29,105
Jan-24 3,587 3,597 3,514 3,538 3,567 3,545 -22 27,411 70,679
Mar-24 3,533 3,533 3,457 3,480 3,512 3,485 -27 2,788 6,556
Palm Oil
Turnover: 1,152,930 lots, or 8.57 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Apr-23 7,652 7,688 7,402 7,458 7,752 7,628 -124 1,262 6,239
May-23 7,656 7,662 7,308 7,372 7,658 7,462 -196 930,793 486,591
Jun-23 7,618 7,628 7,292 7,328 7,622 7,432 -190 28,065 99,641
Jul-23 7,516 7,558 7,232 7,258 7,556 7,372 -184 17,903 76,705
Aug-23 7,502 7,502 7,172 7,200 7,504 7,320 -184 15,901 47,743
Sep-23 7,436 7,442 7,118 7,148 7,436 7,248 -188 138,676 144,275
Oct-23 7,396 7,408 7,108 7,134 7,410 7,268 -142 14,151 29,493
Nov-23 7,396 7,396 7,112 7,140 7,394 7,240 -154 5,305 12,320
Dec-23 7,402 7,402 7,154 7,154 7,380 7,250 -130 37 140
Jan-24 7,398 7,402 7,100 7,150 7,388 7,236 -152 805 1,472
Feb-24 7,372 7,372 7,166 7,166 7,394 7,220 -174 7 97
Mar-24 7,368 7,368 7,160 7,162 7,398 7,234 -164 25 127
Soybean Oil
Turnover: 941,473 lots, or 75.35 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
May-23 8,162 8,184 7,856 7,924 8,166 8,004 -162 719,708 421,774
Jul-23 8,178 8,194 7,870 7,930 8,182 8,000 -182 26,839 102,340
Aug-23 8,122 8,176 7,878 7,916 8,168 7,996 -172 11,934 70,236
Sep-23 8,136 8,156 7,860 7,904 8,138 7,986 -152 142,252 206,836
Nov-23 8,080 8,136 7,868 7,910 8,124 7,998 -126 12,986 43,196
Dec-23 8,148 8,162 7,918 7,972 8,150 8,030 -120 20,729 29,578
Jan-24 8,112 8,156 7,906 7,958 8,140 8,016 -124 6,095 10,408
Mar-24 8,080 8,140 7,900 7,936 8,118 8,016 -102 930 1,636
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