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Grains Consolidate as Planting Catches up to Last Years Levels

By:
David Becker
Updated: May 31, 2018, 12:37 UTC

Grain prices are higher in early North American trade but continue to experience whipsaw price action. Planting of grains was running well behind last

Grains Consolidate as Planting Catches up to Last Years Levels

Grain prices are higher in early North American trade but continue to experience whipsaw price action. Planting of grains was running well behind last year up until this past week, where corn planting caught up and has now surpassed last years pace. The on-again off-again trade spat with China is now heating up again and the White house looks to pick a trade war with Europe on Steel and Aluminum.

Corn Prices

Corn prices edged higher after testing support near an upward sloping trend line that comes in near 3.95. Resistance is seen near the 10-day moving average at 4.01. Momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the red with a downward sloping trajectory which points to lower prices.

Corn planting increased from 81% complete to 92% in the latest data release, up 11 points from last week. This is two points ahead of both last year’s pace and the five-year average. Both Illinois and Missouri have completed planting and finished ahead of their average pace. Pennsylvania remains the furthest behind schedule with 59% of their crop planted vs. a five-year average of 78%. Wisconsin, North Dakota, and South Dakota made the most progress during the latest week by planting 25% of their crop. 72% of the corn crop has emerged, up 22 points from last week and 3 points ahead of the 5-year average. The first crop condition report was released for corn showing that 79% of the crop is rated good to excellent and 3% as poor. Last year at this time, 65% of the crop was rated good to excellent and 7% as poor to very poor.

Soybean Prices

Soybean prices moved higher in early North American trade. Resistance is seen near a downward sloping trend line at 1065. Support is seen near the 10-day moving average at 1024. Momentum is neutral as the MACD (moving average convergence divergence) histogram is printing in the black with a flattening trajectory which points to consolidation.

Wheat Prices

Wheat prices are nearly unchanged in early North American Trade. Support is seen near the 10-day moving average at 522. Resistance is seen near the May highs at 554. Momentum is neutral as the MACD (moving average convergence divergence) histogram is printing in the black with a flattening trajectory which points to consolidation.

About the Author

David Becker focuses his attention on various consulting and portfolio management activities at Fortuity LLC, where he currently provides oversight for a multimillion-dollar portfolio consisting of commodities, debt, equities, real estate, and more.

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