The 9-week moving average for corn is what the technicians were watching coming into today and the rumors that China is buying PNW corn shipments pushed the market through resistance. $4.45 up to $4.50 resistance level will be hard for the bulls unless we get some confirmation of more buying by China or similar news. $4,36 is now support. If the market is still sideways, the market has entered price level where it should find strong resistance.
Latest demand report continues to show stronger demand. Weekly ethanol production at record high levels. Comments circulating China bought 7 cargos of PNW corn. Corn Technical Strength Level is 56% neutral for March futures.
USDA reports probable soybean sales of 114K MT to China. Managed Funds still projected to be long 150K contracts. The soybean trend is still holding to a downtrend. The main support is at $10.50 with the next support at $10.44. Resistance is from $10.63 up to $10.70 and then from $10.80 up to $10.96. down to $10.37. Technical Strength Level shows beans in a downtrend with January futures at 32% bearish range. We are in minor oversold conditions on the short-term charts. Rallies still should be sold until we can turn the backdrop back to a bullish indication.
The USDA announced the sale of 134K tons of 25/26 soybeans to China.
China held its third auction of soybeans from its reserve supplies, as it seeks to make room for the soybeans that its state buyers are purchasing from us to fulfill obligations under the handshake trade deal of October 30. Analysts in China are growing in their confidence that China will purchase the 12 million metric tons (441 million bushels) committed to for this year, but actual shipment of the total will likely be spread out over the next eight months, or longer. Brazil is projection another big harvest. This year’s crop looks to be another 350 to 400 million bushels larger than the last one. The charts below show current corn & soybean ratings in Argentina after yesterday’s update from Buenos Aires Grain Exchange. The 88% G/E seen on corn is the highest for any week in over 4 years and is more than double the previous 5YA (40% G/E) at this time. After widespread solid rains, soybeans broke their 3-week losing streak, rising 7% week-over-week to sit at 65% G/E, in line with last year but still 18% above the previous 5YA.
John R. AndersonVice President of Grain
Farmers Union Cooperative
563-380-2311
