Written Commentary
SOYBEANS
Soybean futures ended higher. There was rumors that China may be buying 1.5 mmt of US new crop soybean as a gesture of good faith as negotiations begin on the Phase 2 trade deal with US. China fell short of buying agreed US Ag goods under the terms of the Phase 1 trade deal. Managed funds were net buyers of 16,000 soybean contracts. Besides the rumors of China buying, managed funds were reported buying US futures as a hedge against inflation. Argentina is seeing needed rains. Paraguay, W MGDS, W Parana and RGDS Brazil remains dry. It is there that soybean yields could drop further from USDA and Private guesses. SH is back resting 14.00. 14.15 is key resistance and important prices to trade over to change price direction higher.
CORN
Corn futures traded higher. CH tested 6.14. Fact that CH held support near 5.85 may have triggered new tech buying. 6.17 key price to trade over to encourage more fund/speculative buying. Talk of increase demand for US corn exports and lower South America supply offers support. There were rumors that China may be buying 1.5 mmt of US new crop corn as a gesture of good faith as negotiations begin on the Phase 2 trade deal with US. China fell short of buying agreed US Ag goods under the terms of the Phase 1 trade deal. China has been an active buyer of US sorghum, Australia and EU feed wheat and Ukraine corn. Managed funds were net buyers of 15,000 corn contracts. Besides the rumors of China buying, managed funds were reported buying US futures as a hedge against inflation. There are still talk that Omicron is reducing work forces especially in Ag transportation. There is also talk that US Ag space is also seeing employees leaving jobs due to vaccine mandate. US barge freight is higher on transportation problems and need for US corn at the gulf. Argentina is seeing needed rains. Paraguay, W MGDS, W Parana and RGDS Brazil remains dry. It is there that corn yields could drop further from USDA and private guesses. Brazil 2nd corn crop will not be available until July.
WHEAT
Wheat futures ended sharply higher. KWH has rallied 55 cents on worries about Russia and Ukraine tension. Ongoing dryness across US south plains HRW crop areas has offset the increase in south hemisphere supplies. Some doubt USDA estimate of Russia and EU wheat exports. Global wheat demand could also be higher that USDA estimate. There were rumors today that China was buying US new crop corn and soybeans. Scientist do not look for any change to global weather due to pacific volcano. The volcano was the largest eruption in the World in three decades. Explosion was similar to 1991 Mount Pinatubo and 1983 Krakatau in Philippines. Our weather guy sees dryness across US south plains into the spring. US Midwest and Russia crop areas could be dry this summer. WH tested the 200 day moving average near 7.40. KWH rest the same average near 7.50. MWH traded below the average and near 8.82.
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