Corn
Price action: May corn futures fell 3 3/4 cents to $4.81 1/4, nearer the session low, while new-crop December futures rose 2 1/4 cents to $4.64 1/4.
Fundamental analysis: The corn futures market saw more profit-taking pressure today following last week’s strong gains that pushed prices to a five-week high. Solid gains in the U.S. dollar index and mild losses in the crude oil market today were bearish outside-market elements for corn.
USDA this morning reported a daily U.S. corn sale of 110,000 MT to Portugal for the 2024-25 marketing year.
USDA Monday afternoon reported U.S. corn planting had reached 4% complete as of April 13, one percentage point behind the five-year average.
World Weather Inc. today said flooding in the lower U.S. Midwest and Delta “will linger for a while over the next ten days, delaying the planting of corn and other crops in many areas. Rain may resume next week which could prolong planting delays in the wettest areas.” Meantime, rain expected in center-west and northern and central parts of center-south Brazil during the coming week to ten days “will provide sufficient moisture to continue supporting Safrinha corn.” Drying in southern parts of center-south and far southern Brazil may lead to a greater need for rain later this month. Argentina weather will also be well mixed over the next two weeks, maintaining a favorable production potential, although eastern areas will have a net drying bias and timely rain may be needed later this month for late season crops, said World Weather.
Technical analysis: The corn futures bulls still have the overall near-term technical advantage. The next upside price objective for the bulls is to close May prices above solid chart resistance at $5.00. The next downside target for the bears is closing prices below chart support at $4.50. First resistance is seen at $4.85 and then at today’s high of $4.88 3/4. First support is seen at today’s low of $4.79 and then at $4.75.
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 fell 5 3/4 cents to $10.36, while May meal futures closed $2.90 lower at $294.20, each forging near mid-range closes. May soyoil rallied 101 points to 47.33 cents, recapturing nearly all of Monday’s losses.
Fundamental analysis: Rallying soyoil seemingly lifted soybeans from session lows, which were pressured by technical resistance at the 200-day moving average along with extended losses in soymeal futures. A firmer U.S. dollar, which rose from last Friday’s three-year low, also applied general pressure across commodities. However, as the session progressed, soyoil futures gathered steam in the wake of the National Oilseed Processor Association’s (NOPA) monthly crush release.
NOPA data for March, indicated members crushed 194.551 million bu., up 16.681 million bu. (9.4%) from February, but bearish against expectations. The figure was also below year-ago by 1.855 million bu. (1.0%). NOPA implies full March crush of about 206.0 million bu. If that is confirmed in the May 1 report from USDA, it would total above 203.535 million last year. March is the seventh month of the 2024-25 soybean crop year. USDA forecasts crush at 2.420 billion bu., up 5.9% from 2023-24.
NOPA soyoil stocks totaled 1.498 billion pounds and were down 5.082 million lbs. from last month’s figure. Stocks were well below the average trade estimate. Implied use for March of 2.352 billion lbs. was well above February’s implied disappearance of 1.892 billion lbs. and in line with the historical highs seen early this year and late last year.
South American crop consultant Dr. Michael Cordonnier maintained his soybean production estimates for Brazil and Argentina at 169 MMT and 48 MMT, respectively. He holds a neutral bias for both going forward.
USDA reported soybean planting in the U.S. advanced to 2% complete through April 13, which was in-line with the five-year average.
Technical analysis: May soybeans continued to face a technical battle at the 200-day moving average, currently trading at $10.41 3/4, while initial support served at $10.29 3/4. Bulls continue to grasp the near-term technical advantage and continue to look toward securing a close above resistance at $10.80, though a move above the 200-day will be crucial in that endeavor. From there, resistance will serve at $10.49 1/2 and again at $10.66 3/4. Meanwhile, bears look to edge back below psychological support at $10.00, though support will be layered around $1.025, then at $10.15.
May soymeal futures were able to hold a close above the 20- and 10-day moving averages, currently trading at $293.80 and $292.10 after a test of both levels during today’s session. Meanwhile, resistance at the 40-day moving average of $297.90 played a pertinent role in limiting buyer interest. Bulls will need to secure a close above psychological resistance at $300.00 to regain technical momentum, while bulls continue to look toward breaching the April 4 low of $282.10.
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 fell 5 1/2 cents to $5.42 and closed near session lows. May HRW futures slid 2 1/4 cents to $5.53. May spring wheat futures closed 3 1/2 cents lower to $6.01 1/4.
Fundamental analysis: Winter wheat futures found little support from deteriorating condition ratings in the Plains today as prices fell for the second consecutive session. USDA rated the winter wheat crop 47% “good” to “excellent” and 19% “poor” to “very poor.” That matched pre-report expectations from both the Reuters and Bloomberg polls. On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop dropped 5.6 points to 319.2, led by a 3-point decline in top producer Kansas. The SRW crop improved 3.8 points to 370.1. Ratings for both crops remain well below year-ago, with HRW down 17.8 points and SRW down 12.0 points. Traders are likely eyeing the forecast which calls for improvement over the next couple of weeks due to greater rainfall. World Weather Inc. notes there will be a few more days of warm and windy days before a cold front moves into the Plains this weekend. Some meaningful rainfall is expected to boost soil conditions this weekend, but a full restoration of the moisture deficit seems unlikely at this juncture.
Changing weather conditions have affected crops globally as well. A sharp cold snap with deep frost and snow across Ukraine in early April virtually stopped the development of grain crops, Ukrainian state meteorologists said. However, heavy rainfall improved soil moisture in many regions. Temperatures are expected to warm over the coming week.
Technical analysis: May SRW futures fell for the second consecutive session and closed just above key support today. Uptrend support stemming from the March low limited the downside today and will remain key support at $5.41. A break below that mark would indicate a technical breakdown, eyeing support at $5.34 1/2. Resistance stands at $5.45, the 20-day moving average, then the psychological $5.50 mark on a reversal higher.
May HRW futures saw relative strength today. Prices remain in a choppy, sideways trend. Support comes in at the psychological $5.50 mark then the March 28 low of $5.43 3/4. Bulls are looking to challenge resistance at $5.61 before taking on stiff resistance at $5.66 1/4, the 20-day moving average, which has capped every rally since the start of the month.
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 99 points to 65.08 cents and marked a high-range close.
Fundamental analysis: Cotton futures reclaimed a portion of recent losses, despite a firmer U.S. dollar, though gains were crimped by lingering overhead resistance.
Meanwhile, USDA reported cotton planting efforts advanced to 5% complete as of April 13, three points behind the five-year average. Plantings stood at 8% in Texas (13% average) and 1% in Georgia (1.0%).
World Weather Inc. maintains South Texas and the Coastal Bend will be dry over the next ten days to two weeks, while a brief bout of rain is expected in West Texas this weekend with greater rain expected later next week and possibly into the following weekend. In the Delta, some river flooding will prevail through the next week to ten days, despite very little new rain. However, rain may return to the region after April 23.
In Brazil, rain is expected to continue to impact Mato Grosso and neighboring areas of Brazil periodically during the next ten days, maintaining a favorable outlook for development. Bahia crops will receive periodic rainfall that may come too late in the season to improve production and could raise concern over fiber quality if the rain lasts too long. In Argentina, northern areas will see net drying for a while, although it should bode well for early maturing crops. Dryness this year did cut into yields, though, according to the forecaster.
Technical analysis: May cotton futures continued to face pressure from the 40-, 20- and 10-day moving averages, currently trading at 66.13 cents, 65.93 cents and 65.57 cents, respectively. Meanwhile, Monday’s low of 63.75 cents, which is backed by the April 4 low of 60.80 cents served up support. Bulls will need to overcome the April high of 68.32 cents to regain technical momentum, while bears will continue to look toward breaching the April 4 low.
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.