April 22, 2014
Morning Price Trends
Corn: Down Up 3 to 3 1/2
Soybeans: Up 4 to 7
Wheat: Up 3 to 4
Note: Farm Futures Senior Editor Bob Burdorfer will be filling in for Bryce Knorr this week.
Corn and soybean futures were higher early on Tuesday to recover some of Monday's losses and were supported by the slow pace of planting in the Midwest.
Wheat turned higher after being lower on Monday.
Corn planting was at 6% in Monday's USDA weekly crop progress report, well behind the five-year average of 14%. However, planting should progress this week with forecasts calling for dry weather in much of the area.
Soybean planting progress will be added to USDA's weekly report next week.
Long-term forecasts put below-normal to much-below-normal temperatures in the Midwest next week, along with above-normal precipitation in much of the area, according to Commodity Weather Group.
There was little direction from stock markets, with futures nearly flat early on Tuesday after recent gains.
Soybeans were higher early on Tuesday after Monday's tumble. The market is stabilizing after jumping to nine-month high last week. Bullish domestic use remained supportive, but much of that has been priced in.
The monthly U.S. crush reported last week was larger than expected and China's economy grew in the first quarter, both bullish signs for soybeans.
Palm oil futures were higher in Malaysia as traders expected increased demand as Muslim countries stock up ahead of Ramadan in late June.
Overhanging the market were last week's reports from China that buyers there may default on up 1.2 million of U.S. and South American soybeans to avoid losses in local markets.
Rain was forecast in parts of Argentina early next week, while the 6-to 10-day outlook was drier, which should allow harvest to continue.
What to look for – Advances in Argentina and Brazil soy harvests. May soybeans remain above the 200-day moving average of $14.80. The Relative Strength Index is near 62. A RSI over 70 implies the market is overbought.
Corn held modest gains early on Tuesday in reaction to the slow planting progress, however planting should advance this week with forecasts for mostly favorable weather before next week's cold.
Futures have trended lower for the past week in anticipation of swift planting in the Midwest. There is still time to get the crop in on time providing the weather cooperates. New-crop December futures closed at a three-week low on Monday.
What to look for – Mostly dry weather in the Midwest this week should allow planting. The 6- to 10-day forecast still calls for below-normal temperatures across much of the Midwest.
Winter wheat traded higher as the markets recovered from Monday's decline. While rain fell in parts of Kansas and Oklahoma recently, much of the area remains dry.
Winter wheat's condition stabilized in Monday's crop progress reports, with 5% rated excellent, 29% good, 33% fair, 20% poor and 13% very poor. A week ago, the percentages were 4%, 30%, 34%, 20%, and 12%, respectively.
In Kansas, the crop was 1% excellent, 23% good, 44% fair, 21% poor and 11% poor. The state report said there were freezing temperatures early last week, but did not say if they harmed the wheat.
More than half of the Texas and Oklahoma wheat continued to be poor to very poor.
What to look for – The winter wheat crop in the central and southern Plains still needs rain. Commodity Weather Group on Tuesday reduced rain chances for the central Plains early next week.
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