Morning Comments/Roy's (RJ O'Brien)

Morning Grain Comments - January 20, 2021

 
SOY-COMPLEX:   Soybeans and products are sharply lower this morning on follow through technical selling/profit taking and continued rains forecast for S. America.  Support for nearby March soybeans near $13.25 which is 38% Fib retrace and then at $12.90-13.00.  Support for March meal near $425 while March soy oil is finding some support here at 41 cents/lb. Malaysian palm oil futures were down 3.3% overnight  on profit taking and concern about slowing demand.  Argentine strike by truckers continues and slowing grain into the ports with just 10% of normal traffic seen.  One source reports only 300 trucks dumped at the ports yesterday instead of the normal 3,000 trucks.  Interior US soybean basis levels steady with meal basis starting to firm.    
 
CORN: Corn is sharply lower with soybeans and wheat this morning.  March corn trying to find support at near $5.10-5.12 which is 23% fib retracement.  Taiwan booked 65k tons of US corn last night for LH Mar/FH Apr shipment.  There were no offers of S. American corn on this tender though there was 1 offer of South African.  Ethanol prices are following the break in corn and keeping margins in the red.  Outgoing President Trump's EPA issued last minute biofuel waivers last night.  Details still forth coming.  US farmer selling on old crop coming to a standstill with the futures break though new crop picked up slightly with CZ still above $4.50.   
 
WHEAT: Wheat is lower this morning  on technical correction and pull back in European values.  The UN did buy 120k tons of Black Sea wheat for donation to Ethiopia.  Traders are awaiting results of the Algerian tender but it's expected to come from France and Baltic regions.  Jordan saw 3 offers on its for tender for 120k tons of wheat with results to be out later today. Russia's Deputy PM expects the 2021 grain crop to be near 131 mmt, down slightly from the 133 mmt this past year.  Support for KC March is at $6.24-6.25 with resistance at $6.60. Outside markets are slightly higher on energies, US equities and US dollar index.