Grains Report 01/17/19

UPDATE 2-USDA recalls workers to help with farm loans, taxes; data uncertain –
16-Jan-2019 04:15:56 PM
To view this story on Eikon, click here
Updates with comments from Farm Credit Council, USDA chief economist
WASHINGTON, Jan 16 (Reuters) – The U.S. Department of Agriculture will reopen about 980 Farm Service Agency (FSA) offices for three days starting on Thursday to help process farm loans and tax documents during the partial federal government shutdown.
About 2,500 FSA employees who have been furloughed by the partial shutdown that began on Dec. 22 have been called back to work without pay, the department said in a statement on Wednesday. It said the offices would be open Thursday, Friday and Tuesday before closing again.

WHEAT
General Comments Winter Wheat markets were a little higher yesterday in consolidation trading and on reports of stronger world prices. The US has not seen much of a demand boost even with less production and higher prices overseas. News that Russia is working harder to restrict exports remains in the background, although Russian exporters are still offering to Egypt and others. The government is working to limit exports to about 18 million tons through the end of June. It might stop some exporters from selling Wheat into the world market. Ukraine is also having trouble sourcing Wheat for export. Russia remains the largest Wheat exporter in the world. US FOB prices are at or below just about all of the competition. SRW Wheat is the worlds cheapest Wheat. World crop reports continue to indicate less production and tightening supplies. Australian and European prices have also been relatively strong.
Overnight News: The southern Great Plains should get mostly dry conditions early week, and rain or snow late week and over the weekend. Temperatures should be near normal. Northern areas should see mostly dry weather, but light snow is forecast for tomorrow and Saturday. Temperatures should be above normal. The Canadian Prairies should see mostly dry conditions, but light snow is possible on Saturday. Temperatures should be near to above normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 508, 504, and 501 March, with resistance at 520, 524, and 530 March. Trends in Kansas City are mixed. Support is at 492, 488, and 485 March, with resistance at 509, 511, and 517 March. Trends in Minneapolis are mixed. Support is at 561, 557, and 553 March, and resistance is at 574, 576, and 578 March.

RICE
General Comments: Rice was higher in recovery trading yesterday. Futures held support areas left from the previous low and will probably try to trade sideways to higher. Weekly charts show more of a sideways trend, and the quiet tone in the cash market is reflected in the futures market as buyers and sellers are not eager to be involved. Volumes traded remain very light. Ideas are the export demand is holding relatively strong, but nothing can be confirmed with the government shutdown.
Overnight News: The Delta should get some precipitation this weekend. Temperatures should be mostly near normal.
Chart Analysis: Trends are mixed to down with objectives of 1045, 1020, and 985 March. Support is at 1034, 1031, and 1019 March, with resistance at 1052, 1069, and 1080 March.

CORN AND OATS
General Comments: Corn was higher on talk of new demand. Prices for US Corn appear cheap in the world market, and ideas are that exporters are buying. Ethanol demand is also starting to improve as Crude Oil and products prices recover. There has not been any confirmation of new Corn export demand. USDA is shut down now, so any demand news will have to wait or will come from the commercials. But, there has been no talk of big sales anywhere. China had promised to buy a lot of US agricultural goods as part of any settlement. There are ideas they will start to buy US Corn, but FOB basis levels were weaker last week, and that means nothing much was going on. Petroleum markets are showing a bottom on the charts now, and that means that ethanol demand could continue to improve. Corn demand for ethanol has softened in the wake of the crushing move to lower prices over the last couple of months in petroleum futures markets. Ethanol prices have also weakened and blenders no longer have a profit margin and have been cutting back on production. The Corn market seems to found increased selling interest when prices get close to the 390 March area, and has been able to find support near 370 March. Trends are currently sideways on the daily charts and mostly up on the weekly charts
Overnight News: Ethanol production rose to 1,051 million barrels per day in the week ending January 11, up from 1,000K million the previous week, but down from 1,061 million the previous year. Ethanol utilized an estimated 107.0 million bushels of Corn in the week ending January 11, versus 101.8 million the previous week and 108.9 million the previous year. Ethanol stocks rose to 23.4 million barrels in the week ending January 11, versus 23.3 million the previous week and 22.7 million the previous year. Marketing year to date estimated Corn use for Ethanol is 2.010 billion bushels, down 2.2% from the previous year. Corn use to date falls short of the seasonal pace needed to hit USDA’s target by 18 million bushels, vs short by 17 mln previous week.
Chart Analysis: Trends in Corn are mixed to down with objectives of 371, 367, and 365 March. Support is at 370, 367, and 362 March, and resistance is at 377, 381, and 384 March. Trends in Oats are mixed to up with objectives of 308 and 309 March. Support is at 292, 290, and 286 March, and resistance is at 299, 303, and 306 March.

SOYBEANS AND PRODUCTS
General Comments: Soybeans and products were mostly a little higher. Trends are still turning down for Soybeans and Soybean Meal, but are still sideways for Soybean Oil. The negotiators said China would buy more US agricultural goods, but gave no specific details. China bought US Soybeans to fulfill its part of an agreement made in Buenos Aires, and might have completed the promised sales with the purchases over the last couple of weeks. There are plenty of Soybeans to sell from the US and South America. South American weather has often been too wet in Argentina and southern Brazil and too dry in western Parana and parts of Mato Grosso an Mato Grosso do Sul. There are forecasts for scattered showers next week in some of the drier areas, but ideas are that the stress will stay even with a little rain. There have been reports of losses in the early harvest areas of western Parana and Mato Grosso.
Overnight News:
Chart Analysis: Trends in Soybeans are down with objectives of 875 and 841 March. Support is at 889, 881, and 871 March, and resistance is at 907, 912, and 915 March. Trends in Soybean Meal are down with no objectives. Support is at 307.00, 305.00, and 304.00 March, and resistance is at 315.00, 321.00, and 327.00 March. Trends in Soybean Oil are mixed. Support is at 2810, 2790, and 2760 March, with resistance at 2860, 2870, and 2880 March.

CANOLA AND PALM OIL
General Comments: Canola was higher on Chicago price action and on ideas that the Canola market was oversold. It is currently very cold in Canadian crop areas, and farmers are not too interested in selling. Trends are down in the market after the price action so far this week. Commercials have plenty on hand for crushing or exporting, and overall demand is said to be light right now. Palm Oil was higher in reaction to stronger vegetable oils markets The daily charts show that futures are trying to trends down
Overnight News:
Chart Analysis: Trends in Canola are down with objectives of 465.00 and 450.00 March. Support is at 474.00, 471.00, and 468.00 March, with resistance at 480.00, 483.00, and 487.00 March. Trends in Palm Oil are mixed to down with objectives of 2140 and 2090 April. Support is at 2160, 2140, and 2130 April, with resistance at 2210, 2220, and 2240 April.

Midwest Weather Forecast: Chances for precipitation late this week and through the weekend. Temperatures should be near normal.

US Gulf Cash Basis
Corn HRW SRW Soybeans Soybean Meal Soybean Oil
January 47 March 137 March 85 March 13 March -2 March
February 49 March 86 March 17 March
March 52 March 86 March 18 March
All basis levels are positive unless noted as negative

Brazil Premiums Soybeans Soybean Meal Soybean Oil Corn
Paraguay Paraguay Paraguay Santos
January
February 20 March -9 March
March -12 March

DJ ICE Canada Cash Grain Close – Jan 16
WINNIPEG — The following are the closing
cash canola prices from ICE Futures.
Source: ICE Futures
Price Change
CANOLA
*Par Region 458.80 dn 3.90
Basis: Thunder Bay
1 Can 499.40 up 3.60
2 Can 486.40 up 3.60
Basis: Vancouver
1 Can 509.40 up 3.60
2 Can 496.40 up 3.60
All prices in Canadian dollars per metric ton.
*Quote for previous day
Source: Commodity News Service Canada
(cnscanada@shaw.ca, or 204-414-9084)

DJ Malaysian PM Cash Market Prices for Palm Oil – January 17
The following are prices for Malaysian palm oil in the cash market at 1000 GMT Thursday, supplied by commodity broker Matthes & Porton Bhd.
Prices are quoted in U.S. dollars a metric ton, except for crude palm oil and palm kernel oil, which are in ringgit a ton. Palm kernel oil prices are in ringgit a pikul, a Malaysian measurement equivalent to 60 kilograms.
Refined, bleached and deodorized palm oil, FOB, Malaysian ports
Offer Change Bid Change Traded
Jan 532.50 +05.00 Unquoted – –
Feb 535.00 +02.50 Unquoted – –
Mar 545.00 +02.50 Unquoted – –
Apr/May/Jun 565.00 +05.00 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Offer Change Bid Change Traded
Jan 537.50 +05.00 Unquoted – –
Feb 540.00 +02.50 Unquoted – –
Mar 550.00 +02.50 Unquoted – –
Apr/May/Jun 570.00 +05.00 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
Jan 545.00 +05.00 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
Jan 400.00 +10.00 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Jan 2,070 +30.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Jan 187.00 +02.00 Unquoted – –
($1=MYR4.1100)

DJ China Dalian Grain Futures Closing Prices, Volume – Jan 17
Soybean No. 1
Turnover: 102,198 lots, or 3.43 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-19 3,265 3,265 3,259 3,259 3,275 3,262 -13 4 2,190
May-19 3,345 3,368 3,343 3,349 3,356 3,354 -2 96,772 161,412
Jul-19 – – – 3,441 3,443 3,441 -2 0 6
Sep-19 3,388 3,408 3,388 3,395 3,403 3,395 -8 4,952 18,760
Nov-19 – – – 3,433 3,442 3,433 -9 0 14
Jan-20 3,403 3,410 3,397 3,404 3,408 3,402 -6 470 2,782
Corn
Turnover: 442,184 lots, or 8.07 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-19 1,828 1,828 1,819 1,827 1,822 1,822 0 57,858 29,556
May-19 1,826 1,828 1,814 1,820 1,815 1,819 4 334,108 1,272,858
Jul-19 1,851 1,851 1,841 1,845 1,844 1,845 1 266 12,118
Sep-19 1,856 1,860 1,846 1,850 1,850 1,852 2 47,414 366,250
Nov-19 1,880 1,881 1,874 1,877 1,876 1,877 1 346 1,254
Jan-20 1,902 1,902 1,888 1,893 1,891 1,894 3 2,192 4,206
Soymeal
Turnover: 1,604,520 lots, or 41.05 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-19 2,609 2,634 2,581 2,585 2,659 2,613 -46 275,134 184,648
May-19 2,537 2,554 2,531 2,538 2,545 2,540 -5 1,159,214 1,959,772
Jul-19 2,550 2,561 2,540 2,551 2,550 2,549 -1 1,246 9,034
Aug-19 – – – 2,583 2,588 2,583 -5 0 236
Sep-19 2,584 2,596 2,575 2,587 2,587 2,584 -3 155,378 476,032
Nov-19 2,599 2,615 2,593 2,606 2,603 2,602 -1 2,958 4,284
Dec-19 2,615 2,624 2,615 2,624 2,616 2,621 5 16 142
Jan-20 2,635 2,657 2,631 2,647 2,647 2,643 -4 10,574 41,624
Palm Oil
Turnover: 388,602 lots, or 17.84 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Feb-19 – – – 4,362 4,362 4,362 0 0 28
Mar-19 – – – 4,606 4,606 4,606 0 0 14
Apr-19 – – – 4,736 4,736 4,736 0 0 18
May-19 4,612 4,612 4,568 4,578 4,616 4,586 -30 365,242 427,970
Jun-19 4,686 4,688 4,672 4,688 4,698 4,682 -16 22 52
Jul-19 4,676 4,690 4,676 4,688 4,726 4,686 -40 10 24
Aug-19 – – – 4,682 4,720 4,682 -38 0 2
Sep-19 4,644 4,644 4,604 4,614 4,644 4,618 -26 23,076 73,860
Oct-19 4,686 4,698 4,686 4,698 4,738 4,696 -42 12 26
Nov-19 4,652 4,718 4,652 4,700 4,698 4,696 -2 24 40
Dec-19 4,648 4,708 4,648 4,708 4,700 4,680 -20 38 36
Jan-20 4,668 4,674 4,650 4,658 4,676 4,660 -16 178 962
Soybean Oil
Turnover: 430,254 lots, or 23.78 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-19 5,122 5,154 5,122 5,154 5,152 5,132 -20 14 158
May-19 5,550 5,552 5,494 5,504 5,556 5,520 -36 378,056 712,994
Jul-19 – – – 5,622 5,658 5,622 -36 0 18
Aug-19 – – – 5,576 5,612 5,576 -36 0 2
Sep-19 5,594 5,594 5,540 5,544 5,590 5,566 -24 50,844 171,882
Nov-19 – – – 5,652 5,676 5,652 -24 0 2
Dec-19 5,564 5,650 5,564 5,650 5,702 5,620 -82 6 10
Jan-20 5,680 5,788 5,648 5,656 5,678 5,670 -8 1,334 5,134
Notes:
1) Unit is Chinese yuan a metric ton;
2) Ch. is day’s settlement minus previous settlement;
3) Volume and open interest are in lots;
4) One lot is equivalent to 10 metric tons.