Grain Express 10/11/22
Posted: Oct. 11, 2022, 8:22 a.m.
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Delayed
Yesterday was Columbus Day, a federal holiday, which pushed back government work. Weekly export inspections and crop progress will both be released today and their normal times.
WASDE
Tomorrow's USDA report is scheduled to be out at 11:00 am CT. The average estimate for corn yield is 171.8, down from 172.5 in September. The average estimate for the soybean yield is unchanged at 50.5. We will be sending out more estimates after the close.
STRIKE!
The Brotherhood of Maintenance of Way Employes Division of the Teamsters (freight rail workers union) rejected a temporary agreement which means they are back to the negotiating table. If an agreement is not met by November 19th, we could see a strike.
A Look at the Outside Markets
Equity markets are softer, and the dollar is little changed. Crude oil is down over $2.00, back below the $90.00 level.
Corn
December corn futures were the beneficiary of a smoking hot wheat market, which was nearly limit up at one point in yesterday's session (70 cents). That took corn futures to their highest price since June 21st. If the Bulls can achieve consecutive closes above 700, we could see an extension towards 725 3/4-728 1/4, which represents the gap from June 21st. We've been talking about leaning on the sell side at these levels, but with a USDA report tomorrow, the uncertainty puts the breaks on the conviction.
Seasonal Trend in Play: December corn has been higher from October 10th-October 20th for 13 of the last 15 years.
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Soybeans
Soybeans had a strong move higher to start the week but couldn't get out above the psychologically significant $14.00 handle. This was not only a failure, but it was also a rejection. This has us walking back some of conviction on our bullish bias after "filling" the gap last week at 1350. If that area is retested it could lead to a bigger technical breakdown. There's not a lot of support below last week's lows until you get closer to $13.00.
Seasonal Trend in Play: November soybeans have been higher from October 4th-October 27th for 13 of the last 15 years.
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Wheat
December wheat futures came within a stone's throw of limit up yesterday (70 cents), trading to their highest price since July 11th. In yesterday's report we labeled resistance as 940-950. The failure to get out above here has brought prices back to our pivot pocket, which we have had listed as 913-923. The volatility to start the week has recalibrated and has us moving resistance up to 954-968 1/2. This is a lot wider of a pocket than we would like to use, but the volatility and the significance within that pocket calls for it.
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