Grains Report 05/03/2023

DJ CBOT Delivery Intentions: Totals – May 3
Source: CME Group
Contract Quantity Next Trade
Commodity Month Delivery Day Assigned Today Date Available
KC HRW WHEAT May May 04, 2023 1 Apr 25, 2023
OATS May May 04, 2023 3 May 02, 2023
WHEAT May May 04, 2023 309 May 02, 2023

WHEAT
General Comments: Wheat markets were lower again yesterday and all three markets made new lows for the move on weak demand ideas and on forecasts for rains in dry parts of the western Great Plains. More showers are in the forecast for this week and will be welcome as not all areas got hit last week. The showers are expected to be more scattered this week. Uncertainty about the Black Sea Corridor deal continued, but it now appears that Turkey will act as a go between for Russia in Wheat and other grains payments. Russia has said that the current system cannot last and seems ready to kill the deal completely. It has been talking to Turkey about the deal and to the UN. 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. Ideas are that both Australia and Russia are harvesting record to near record Wheat crops this year. Both countries will have a lot of Wheat to export.
Overnight News: The southern Great Plains should get showers and storms. Temperatures should be below normal. Northern areas should see mostly dry conditions. Temperatures will average below normal. The Canadian Prairies should see mostly dry conditions. Temperatures should average below normal.
Chart Analysis: Trends in Chicago are down with no objectives. Support is at 608, 602, and 596 July, with resistance at 626, 645, and 666 July. Trends in Kansas City are down with no objectives. Support is at 736, 730, and 724 July, with resistance at 764, 781, and 808 July. Trends in Minneapolis are down with no objectives. Support is at 768, 762, and 756 July, and resistance is at 786, 806, and 814 July.

RICE:
General Comments: Rice was higher once again yesterday on follow through buying after news that major commercial Bunge had taken just about all of the First Notice Day deliveries. Bunge actually redelivered some of those contracts yesterday but the market still held and rallied. Trends are up on the daily charts with the price action since last Friday. Offers seem hard to find right now, but demand has been a problem all year. Export demand has been uneven and was low last week. Export demand has been an issue for the market all year. Mills are milling for the domestic market in Arkansas and are bidding for some Rice.
Overnight News: The Delta should get widespread rain. Temperatures should be near to below normal.
Chart Analysis: Trends are up with objectives of 1820 July. Support is at 1758, 1749, and 1742 July and resistance is at 1795, 1806, and 1820 July.

DJ USDA World Market Rice Prices – May 3
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) ($/cwt)
Long Grain 19.01 11.64 0.00
Medium/Short Grain 18.75 12.34 0.00
Brokens 11.06 —- —-
This week’s prevailing world market prices and MLG/LDP
rates are based on the following U.S. milling yields and
the corresponding loan rates:
U.S. Milling Yields Loan Rate
Whole/Broken ($/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 and Oats closed lower again yesterday, with Corn still finding some support from little US producer selling interest but getting hurt from little commercial and export buying interest. Oats were lower and made new lows for the move. The weather was wet and cool in the Midwest last week and producers were not selling Corn, but the market wants Corn now. It is now wet and cold in the Midwest, but producers are still inclined to wait and might have trouble sourcing trucks to haul grain, anyway. Most are thinking about getting into the fields and are not even worried about the market. US prices are currently very competitive with those from South America as Brazil concentrates on Soybeans exports and not Corn and US demand has improved because of the price differentials and the lack of a Brazil offer into the market. This trend should continue for the next few months. NOAA is forecasting that La Nina will develop this Summer and replace El Nino. US growing conditions are usually good when this happens but there are concerns about ocean water temperatures that are increasing rapidly in the Pacific and have alarmed some forecasters.
Overnight News:
Chart Analysis: Trends in Corn are mixed. Support is at 572, 566, and 560 July, and resistance is at 590, 597, and 601 July. Trends in Oats are down with no objectives. Support is at 300, 294, and 288 July, and resistance is at 310, 324, and 328 July.

SOYBEANS
General Comments: Soybeans and the products were lower yesterday as selling tied to reports that Brazil basis levels are so low that some American processors can import more cheaply than buying from US producers. Reports this week indicate that the basis s forming in Brazil, but prices for Brazil Soybeans remain cheap compared to those found in the US. Brazil has been selling a lot of Soybeans to China to feed its record Soybeans demand. Brazil has a very good crop, but the additional Soybeans grown in Brazil will be partially wiped out by the losses in Argentina. Argentina has been forced to import from Brazil to keeps its crushing facilities operating. The US might sell to China for storage purposes as well and could pick up some new business from countries other than China as Brazil ports will be loaded with ships bound for China. The US has also bought Soybeans in Brazil this year due to the extreme differences in prices. Production ideas in Argentina are less than 25 million tons, or less than half a crop. Forecasts from NOAA for very good growing conditions in the Midwest were also a factor, but there are concerns about ocean water temperatures that are increasing rapidly in the Pacific and have alarmed some forecasters.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed. Support is at 1397, 1384, and 1372 July, and resistance is at 1435, 1440, and 1456 July. Trends in Soybean Meal are mixed. Support is at 422.00, 420.00, and 411.00 July, and resistance is at 434.00, 443.00, and 445.00 July. Trends in Soybean Oil are mixed to down with no objectives. Support is at 5060, 4920, and 4800 July, with resistance at 5270, 5420, and 5480 July.

CANOLA AND PALM OIL
General Comments: Palm Oil was a little higher today on price action in Soybean Oil and as no industry was willing to sell due to the cheap prices. Demand is also a problem as India imports are at a 14 month low right now. The market saw late week selling last week on news that Indonesia will reduce its domestic supply requirement from 450,000 tons to 300,000 tons before exports can begin. The news means more Palm Oil will be released for exports and in competition with Malaysia. There are ideas are that prices can remain elevated due to bad weather in Malaysia but demand remains weaker than hoped for from India and China. In fact, exports so far this month are down about 25% from last month. Indonesia has not been offering as it tries to build stocks for its own bio fuels industry but it is expected to start offering very soon. Trends are still sideways on the weekly charts but are down on the daily charts and the daily charts now look oversold. Canola was higher as domestic crush demand holds strong. Brazil is expected to dominate the world oilseeds market for the next few months. Reports indicate that domestic demand has been strong due to favorable crush margins.
Overnight News:
Chart Analysis: Trends in Canola are mixed to down with objectives of 684.00 July. Support is at 688.00, 682.00, and 676.00 July, with resistance at 716.00, 721.00, and 739.00 July. Trends in Palm Oil are mixed to down with no objectives. Support is at 3290, 3170, and 3050 July, with resistance at 3460, 3530, and 3560 July.

Midwest Weather Forecast: Rain and snow. Temperatures should average below normal.

US Gulf Cash Basis

Corn HRW SRW Soybeans Soybean Meal Soybean Oil
April
80 May
175 May
105 May
90 May

May
75 May
175 May
105 May
90 May

June
100 July
173 July 70 July
110 July

DJ ICE Canada Cash Grain Close – May 2
WINNIPEG–The following are the closing cash canola prices from
ICE Futures for May 2, 2023.
Source: ICE Futures
CANOLA
1 Canada NCC Best Bid
Spot Price Basis Contract Change
*Par Region 732.60 28.00 Jul 23 up 9.20
Basis: Thunder Bay 756.40 47.00 Jul 23 up 4.80
Basis: Vancouver 764.40 55.00 Jul 23 up 4.80
*Quote for previous day
Source: MarketsFarm (news@marketsfarm.com, or 204-414-9084)

DJ Malaysian PM Cash Market Prices for Palm Oil – May 3
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
May 940.00 -35.00 Unquoted – –
Jun 867.50 -17.50 Unquoted – –
Jul/Aug/Sep 810.00 -05.00 Unquoted – –
Oct/Nov/Dec 807.50 -07.50 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Offer Change Bid Change Traded
May 950.00 -35.00 Unquoted – –
Jun 877.50 -17.50 Unquoted – –
Jul/Aug/Sep 820.00 -05.00 Unquoted – –
Oct/Nov/Dec 817.50 -07.50 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
May 890.00 -10.00 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
May 770.00 -10.00 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
May 4100.00 -50.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
May 238.00 -01.00 Unquoted – –
($1=MYR4.451)

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