Grains
The grain markets were relatively resilient following Friday’s bearish WASDE report and a rallying dollar today. Begs the question – was the pre-report sell-off mostly priced in? That question became harder to answer after news came out that USDA missed last week’s export inspection totals by a country mile (surprise, surprise). Specifically, corn export inspections were revised to 1,092.36 MMT compared to the reported figures of 856.6 MMT. Meanwhile, soybean export inspections 1,040.62 MMT compared to the meager 674.75 MMT reported figure.
Corn:
March corn bounced on either side of unchanged during today’s session, but ultimately closed 3 ½ cents lower to settle at 443 ½. During the day, we traded as high as 451 ½. While we settled near the lower end of the day’s trading range, it’s a stretch to say that today’s price action was abjectly bearish – especially considering Friday’s report. As long as we can defend 2-star support at 441, eyes should be on moving back to the 452-457 pivot pocket.
Soybeans:
Soybeans were the sole component of the grain complex to close Tuesday’s session higher, settling 3 ¼ cents higher at 1227 ½. Last Friday’s USDA report was not friendly to soybean prices, but neither is a little over a 35% miss on export inspection totals. The resilience that March soybeans have shown after trading down to, and bouncing higher off of, the 78.6% retracement of the June lows and July highs shouldn’t be discounted. Moreover, it hit the price target from the recently developed head-and-shoulders. Today’s close defended 2-star support at 1224, and a close inside of our 1250-1260 pivot pocket will provide further guidance as to whether the pre-report price action was priced in.
Wheat:
Coming out of the WASDE report, it looked like wheat was the most bullish component of the grain complex because there were no materially significant line item alterations. However, the Dollar Index gapping, and subsequently closing nearly a full percent higher on the day was enough to take the wind out of bulls’ sales. For the day, March wheat closed 14 ¼ cents lower to settle at 581 ¾. In order to work back towards our pivot pocket between 608 ½ – 611, March wheat will need to see a close above 591.