Corn
Price action: May corn rallied a nickel to $4.74, forging a six-week high close.
Fundamental analysis: Early short-covering efforts in corn ultimately paused as the session progressed as technical headwinds and looming trade uncertainties buffered momentum. However, around the noon hour, President Trump announced a 90-day pause on tariffs for non-retaliating countries, while simultaneously imposing 125% tariffs on China, triggering a risk-on tone across the general marketplace. Moreover, some optimism is seemingly looming around potential trade deals, with some 70 countries willing to negotiate tariffs. Bangladesh has announced it plans to buy more U.S. cotton in hopes of persuading Trump not to maintain a 37% tariff on exports that threaten its vital garment sector, according to the Financial Times. This was combined with an offer to “significantly increase” imports of wheat, corn and soybeans, in addition to streamlined customs procedures.
However, ethanol production has declined as of late, averaging 1.021 million barrels per day (bpd) during the week ended April 4. This marked a 42,000 bpd (4.0%) decline from the previous week and was 14,000 (1.3%) below the same week last year. Meanwhile, ethanol stocks rose 422,000 barrels to 27.034 million barrels.
Traders will get a look into weekly exports as USDA is set to release its weekly export sales data early Thursday morning. Analysts are expecting net sales to have ranged from 700,000 MT to 1.3 MMT during the week ended April 3. USDA will also release its monthly supply and demand update at 11 a.m. CT, which is expected to include minimal changes, though could include some changes to use.
Technical analysis: May corn futures ultimately notched a close above the 40-day moving average of $4.72 3/4, with bulls edging closer to their recent target of $4.77 1/2 as they continue to tighten their grasp on the near-term technical advantage. A move above the area would find the camp then targeting the psychological $5.00 area. Meanwhile, bears continue to look to secure a close below the March low of $4.42, though first support will now serve at the 40-day moving average, then at the 20- and 10-day moving averages, each trading around $4.60 1/2, and again at the 200-day moving average of $4.53 1/4.
What to do: Get current with advised sales.
Hedgers: You should be 70% sold in the cash market on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Cash-only marketers: You should be 70% sold on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Soybeans
Price action: May soybeans rose 20 cents to $10.12 3/4, near the daily high. May soybean meal rose $3.50 to $294.50, nearer the daily high and hit a two-week high. May soybean oil gained 125 points to 46.19 cents, nearer the session high and hit a two-week low early on.
Fundamental analysis: The soybean complex got a boost late today on news the Trump administration is lowering tariffs on all countries that have not retaliated against U.S. tariffs, but is raising tariffs on China to 125%. This rallied the U.S. stock market and in turn encouraged, at least temporarily, the soybean market bulls. This situation remains very fluid. Crude oil prices erased earlier sharp losses on the latest tariff news and that was also supportive to the soy complex futures.
USDA this morning reported a daily U.S. soybean sale of 198,000 MT to unknown destinations for delivery during 2024-25.
World Weather Inc. today said flooding rain in the lower U.S. Midwest and Delta this week will delay planting for at least a couple of weeks and a few recently planted fields may need to be replanted. Meantime, rain will fall in most of Brazil including Bahia and northern Minas Gerais at one time or another during the next 10 days to two weeks. The moisture “should be good for most late-season crops.” Argentina weather will also be well mixed over the next two weeks, maintaining a favorable production potential.
Thursday near midday comes the latest USDA monthly supply and demand report. Soybean traders look for virtually no changes in the April soybean balance sheet versus the March report. The same goes for South American soybean production numbers.
Thursday’s weekly USDA export sales report on Thursday morning is expected to show U.S. soybean sales of 200,000 to 700,000 MT in the 2024-25 marketing year, and sales of zero to 50,000 MT in the 2025-26 marketing year.
Technical analysis: The soybean bears have the overall near-term technical advantage as prices are in a two-month-old downtrend on the daily bar chart. The next near-term upside technical objective for the soybean bulls is closing May prices above solid resistance at the April high of $10.34 3/4. The next downside price objective for the bears is closing prices below solid technical support at the March low of $9.91. First resistance is seen at today’s high of $10.15 1/2 and then at $10.25. First support is seen at $10.00 and then at today’s low of $9.87 1/2.
Soybean meal bears have the overall near-term technical advantage. Prices are in a three-month-old downtrend on the daily bar chart, but now just barely. The next upside price objective for the meal bulls is to produce a close in May futures above solid technical resistance at the March high of $309.80. The next downside price objective for the bears is closing prices below solid technical support at the contract low of $282.10. First resistance comes in at today’s high of $297.00 and then at $300.00. First support is seen at today’s low of $289.50 and then at $285.00.
Bean oil bulls have the slight overall near-term technical advantage. The next upside price objective for the bean oil bulls is closing May prices above solid technical resistance at the April high of 48.54 cents. Bean oil bears’ next downside technical price objective is closing prices below solid technical support at the March low of 41.08 cents. First resistance is seen at today’s high of 46.23 cents and then at 47.00 cents. First support is seen at 45.00 cents and then at today’s low of 43.83 cents.
What to do: Get current with advised sales. Our next sales target is $11.00 in nearby futures.
Hedgers: You should be 55% sold in the cash market on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Cash-only marketers: You should be 55% sold on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Wheat
Price action: May SRW futures closed 2 1/4 cents higher to $5.42 1/4 and closed near mid-range. May HRW futures climbed 6 1/2 cents higher to $5.68. May HRS futures rose 7 3/4 cents to $6.08 3/4.
Fundamental analysis: Wheat futures worked higher for the third consecutive session but continue to butt up against technical resistance which has capped gains for the past three sessions. The headwinds wheat continues to face despite fresh highs in corn and soybeans are rather disappointing but reflect the relatively steady outlook for wheat. That steady outlook is reflected in pre-report expectations for tomorrow’s WASDE from USDA. A Bloomberg survey of analysts shows expectations of ending stocks of 826 million bushels which would be up modestly from the March report at 819 million bushels. That difference can be attributed to an expected drop in exports.
Minimal changes are expected on the world balance sheet. A Bloomberg poll showed expectations that world ending stocks will rise 300,000 MT to 260.4 MMT. While that would still be the tightest since 2015-16, the market has shaken off tight world wheat ending stocks. Weather concerns are not really present for much of the world’s wheat producers at this point. Until the world’s top wheat importers start buying more wheat, a sustained rally seems unlikely.
USDA will release its weekly export sales tomorrow morning. Analysts’ expectations range from 100,000 MT in sales reductions to sales of 400,000 MT for the 2024-25 marketing year. Last week, sales totaled 339,986 MT.
Technical analysis: May SRW futures saw strength again today but still have been capped by resistance at the 20-day moving average. That resistance, now at $5.44 1/2, has capped gains the past three sessions. Strength above that mark has bulls targeting the psychological $5.50 mark, which is backed by the 40-day moving average at $5.53 1/4. Bulls are seeking to hold prices above 10-day moving average resistance at $5.39 1/4, which is backed by support at $5.28 1/4.
May HRW futures posted strong gains today, though the upside was capped by the 20-day moving average, which will remain resistance at $5.70 1/4. Strength above that mark looks to topple resistance at $5.75, while support comes in at $5.60 on a reversal lower.
What to Do: Get current with advised sales.
Hedgers: You should be 85% sold in the cash market on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cash-only marketers: You should be 85% sold on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cotton
Price action: May cotton rose 108 points to 66.63 cents and nearer the daily high.
Fundamental analysis: Cotton got a lift late today on news the Trump administration is significantly lowering tariffs on all countries that have not retaliated against U.S. tariffs, but is raising tariffs on China to 125%. This rallied the U.S. stock market and in turn encouraged, at least temporarily, the cotton market bulls. This matter remains very fluid. Crude oil prices erased earlier sharp losses on the latest tariff news, which was also supportive for cotton.
World Weather Inc. today said west and south Texas will be dry over the next 10 days to two weeks. Rain is needed most in west Texas since south Texas received rain recently. Excessive rain in the U.S. Delta recently “has saturated field conditions and delayed fieldwork. Some flooding will prevail through the next week to 10 days, despite very little new rain. The U.S. southeastern states received some earlier this week and areas near the Atlantic Coast may need more rain,” said the forecaster.
Cotton traders are awaiting Thursday morning’s monthly USDA supply and demand report. Traders look for virtually no change in the cotton supply and demand balance sheet, versus the March report. The weekly USDA export sales report is also out Thursday morning, with cotton bulls hoping lower prices recently will make for better U.S. cotton export sales numbers than in previous weeks.
Technical analysis: May cotton futures prices today scored a bullish “outside day” up. The cotton futures bears have the overall near-term technical advantage. However, the bears appear to be exhausted now. The next upside price objective for the cotton bulls is to produce a close in May futures above technical resistance at the March high of 67.80 cents. The next downside price objective for the cotton bears is to close prices below solid technical support at the contract low of 60.80 cents. First resistance is seen at today’s high of 67.00 cents and then at 67.50 cents. First support is seen at 65.00 cents and then at today’s low of 64.25 cents.
What to do: Get current with advised sales and hedges.
Hedgers: You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.