Heavy rains and thinking of late plantings pushing more bean acres into seeded acres as projections of 80 million acres planted of beans versus the record of 80.3 abound. Yet traders keep talking about that it is not what you plant it is what you grow and the thinking is that yields will be much lower this year off the tail of an El Nino growing season. Corn still looks to compete coming in at 30 percent planted versus 16 percent last year, China’s corn projection looks to be off 10 million metric tons. This is what happens when corn is under $4.00 ahead of planting in the U.S. To date weather has been good for the winter wheat crop coming in at 59% good to excellent condition versus 57% last week.
The trade feels that the wet weather has been helpful, but the next two weeks look even wetter and at this time of key development, the continued rains may hurt the crop and deteriorate the ratings. Non-commercial funds are still short 97,000 contracts in wheat. Liquidation of these contracts due to adverse weather could put $1.50 on wheat. Look to buy the grains lower Friday, then look for a higher opening and trade Sunday, but as usual take profits off Sunday - Monday rally as turnaround Tuesday will weigh on the down side and the market will then take profits ahead of May’s USDA crop report released on May 10th. Technical’s read like this, December corn has support at 3.80, close under and 3.65 is next.
Resistance lies at 3.95, 4.00, then 4.13 and 4.20. November bean
support lies at 9.76 then 9.50, resistance is 10.40.
Support on July wheat lies at 4.76,
resistance 5.00, 5.10 then 5.40.