April 17th 2012
Brad Olson - Grain Marketing Specialist
Yesterday’s scheduled USDA crop progress was postponed due to power outages in Washington DC. Expectation is for a record planting pace.
Corn has struggled of late on early planting pace and now moisture. May corn broke the 6.27 support that I have been watching and with all my technical indicators still bearish I would not be surprised to see us test the March low of 6.04 before we could find footing. If we do look to recover expect resistance at 6.38 and 6.49. It will be interesting to see if softer prices entice any new export business. Early planting usually means early harvest easing the old crop balance sheet tightness. New crop- I look for support at 5.23 and 5.10 and resistance at 5.45 and 5.56.
Soybeans: 6 higher
Soybeans broke recently but still not to the point that I would say we have a trend reversal. We are still staring long term global situation for 12/13 that still needs attention. Currently New Crop soybean to corn ratio is at 2.58:1. This is worth noting and may have some influence on plantings but it most likely will not be enough to ultimately fix the problem. Now we don’t want to get blinders on and think that this market can go nothing but higher because there are things could fundamentally move the market lower ie the Chinese economy or a shift to another oilseed product. While there may be some ebb and flow to this, especially with funds holding a sizeable position, this market looks to be fundamentally strong.
Wheat: 2 higher
Overall commodity weakness and what looks to be a big wheat crop continues to pressure wheat. Crop Condition report should be released tonight and is expected to show improved ratings.
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