3/22/18

Morning Bullet Points - 03/22/2018

GOOD MORNING—

MARKET HIGHLIGHTS

  • Markets trading mostly higher overnight with wheat seeing the best gains after closing well off the lows yesterday.
  • Export sales will be delayed until tomorrow due to the winter storm hitting the east coast.
  • Informa expected to release their acre estimate at 10:30am CST this morning.
  • Brazil second crop corn planting is nearing completion.
  • South Korea bought 68,000 MT of corn, 60,000 MT of meal, and an unknown quantity of feed wheat.
  • Corn technically is trading in the area where we consolidated during the middle of February with the bottom of that range at 3.70 and 3.75 the top side.  The trend is higher with the market oversold on the recent pull-back.
  • Soybeans technically pulling back to the area where a lot of consolidation took place during much of October and November.  Support at 10.30 and 10.20.  Resistance at 10.50.
  • Wheat technically put in a bullish reversal off its lows yesterday with good upside follow through overnight.  Support at 4.50 and resistance well above the market near 4.80.

WEATHER   

  • US winter wheat areas catching some rains, but the S/SW corner of KS is still short-changed.
  • 2/3 of Argentine growing areas remain dry.
  • Brazil expected to see scattered showers over the next couple of weeks.

OUTLOOK

  • We will get Informa’s numbers this morning, but if they follow the recent trend, we should expect it to be supportive the corn market.  Corn has a good story moving forward.  I think there is a chance that the current pullback has run its course and that any sales that were made on the run-up should be re-owned.  If the lows from earlier this week do not hold, there is probably another 10-15 cents downside risk.  Regardless, I think we will see higher prices over time and potentially much higher prices if we have problems during the growing season.
  • Soybeans don’t have a lot going for them other than the Argentine production problems, which have already been traded.  A bullish corn acre number will probably mean a bearish bean acre number.  Longer term, though, I think corn will pull beans higher.
  • Wheat looks to have had its correction to the downside.  Buy any small pullbacks.

Fun Fact of the Day:  At 4,841 years old, this ancient bristlecone pine tree is the oldest known non-clonal organism on Earth. Located in the White Mountains of California, in Inyo National Forest, Methuselah's exact location is kept a close secret in order to protect it from the public.

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