Corn futures were lower on consolidation today. Resistance and a short-term top for May futures lies at $3.95 ¼. During the session, the May contract broke below daily chart support at $3.85 ¾, which was the March 8th low. Today’s close below that level would suggest the bears are gaining momentum and opening the door to a deeper corrective phase. This afternoon will bring the weekly COT report. Funds remain net long corn. The trade will be looking to see if that position increased through Tuesday, which was prior to the recent break in futures. A recent wire story reported U.S. corn exports sales have exceeded 650 mln. bu. since early January, which is more than usual for any time of the year. The 650 mln. bu. of corn sold within the nine weeks (ended March 8th) represent more than a quarter of the USDA’s annual target of 2.225 bln. bu. It is also the largest-ever volume of net U.S. corn sales for a nine-week period since records began in 1990. Argentina's Rosario Grains Exchange is the latest group to drop their estimate for the country’s corn crop, estimating it at 32 MMT’s versus their previous estimate of 35 MMT’s. The U.S. two-week weather forecast has turned slightly drier & slightly warmer in its latest runs. The Midwest looks to have an elevated chance for rain but significant coverage is not expected very far south of central Illinois. Rains are highly likely for the region on Saturday with temperatures expected to drop and create some ice north of Interstate 74.
Soybean futures were firmer today. Buyers emerged following yesterday’s dip, allowing futures to post a strong recovery on Thursday and that buying continued into today. Resistance for the May contract sits at Wednesday's high of $10.54. On the downside, support lies at $10.27. Traders will be watching Argentina’s weather this weekend as drought and dryness continues to affect soybean pod filling. If the forecasted rain materializes, it should help to stabilize the crop in some locations. Argentina's Rosario Grains Exchange came out with their updated production estimate, which they dropped 14%; saying drought would limit the crop to 40 MMT’s from their previous estimate of 46.5 MMT’s. Argentine weather is keeping domestic crush margins strong. This morning the USDA announced the sale of 20,000 tons of soy oil to unknown for 2017/18. Brazilian farmers in Mato Grosso reportedly signed a memorandum of understanding with the Panama Canal Authority to evaluate ways to cut transportation costs and boost Brazilian grain volumes using the waterway. The canal's administration is looking to increase its participation in rising Brazilian grain exports, since a large part of grain trade expansion in Brazil is via new terminals in the northern part of the country, which are closer to the canal.
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