12/15/17

Morning Bullet Points - 12/15/2017

GOOD MORNING—

MARKET HIGHLIGHTS

  • NOPA crush out at 11am this morning with expectations for 163.1 mbu.
  • Reports yesterday afternoon that Argentine soybean acres may come in lower than expected due to dry weather.
  • Kazakhstan cut their 2017/18 grain production forecast from 9 MMT to 8 MMT.
  • Corn technically sitting at the bottom of the trading range, but still range-bound.  Support at 3.48, resistance at 3.55, and 3.50 continues to be a magnet.
  • Soybeans technically trading near recent lows and below major moving averages.  Support is at 9.30 and resistance 9.80.
  • Wheat is correcting from oversold conditions with support at 4.10 and resistance 4.20.
  • USDA reported 257,000 MT of soybeans to China for 2017/18.
  • USDA reported 134,500 MT of corn to Costa Rica for 2017/18.
  • USDA reported 126,000 MT of soybeans to unknown for 2017/18.
  • USDA reported 130,000 MT of SRW to unknown for 2017/18.

WEATHER         

  • Brazil sees rains move to drier areas in the coming weeks.  The 6-10 and 11-15 period both have chances for rains, which should keep much of the country in good shape.
  • Argentina has chances for showers over the next 10 days, but the 11-15 looks dry.

OUTLOOK

  • Corn continues to find buying interest whenever it drops much below 3.50.  The overall fundamental picture remains the same with big supplies and big demand.  I think we can see a 10-20 cent bounce from here, but be ready to sell into a move like that as I don’t see much to push us out of the current range for now.
  • Soybeans have been on a free-fall the last couple days on weakness in the cash market and an improved outlook in South America.  There were some sales announced this morning, which may stabilize futures today.  Additionally, the Brazilian Real has been climbing higher over the several weeks, which should start to lend support at some point.
  • Wheat had a flash sale of SRW for the first time since 2013.  I think prices are probably cheap enough where it does not make a lot of sense to be bearish, but I think another 10-15 cents to the upside is about all the bulls can look for.

 

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