Corn, Wheat and Soybeans Rally on Lower Grains ForecastsWheat, corn, and soybeans are rallying on Wednesday as investors are digesting USDA forecast cut to put prices up.
Grains prices such as soybeans, corn, and wheat are rallying on Wednesday as investors are digesting the recent USDA national crop report, including a cut in 2019 season forecast on midwest flooding.
The US Department of Agriculture reported that despite some improvement in the planting season, severe weather has put planting progress at its slowest pace on record. The USDA is now expecting domestic corn yields to be the lowest since 2013.
USDA is now expecting 13.68 billion bushels of corn, 9% below previous projection. Experts expect more cuts in the weeks to come.
Grains report for June 12
Soybeans are rallying on Wednesday with the bushel breaking above the 200-day moving average and trading as high as 8.753, its highest level in a week.
Corn is extending gains on Wednesday with the pair testing may-end highs around the 4.300 area. Technical conditions are strong for a continuation. Wheat jumps for the third day in a row to trade at 5.235, the highest level since February 6.
Sugar finally broke above the 0.1240 area on Tuesday with the unit extending gains on Wednesday and trading at 0.1245, its highest level transacted since April 25.
Coffee futures, on the other hand, attempted to trade positive on Wednesday but it got a rejection at the 200-day moving average at 102.35, and it was sent back below the 100.00 area.
Corn ready to test 4.300
Prices of corn are trading higher for the third day after the USDA cut its forecast production of corn for this season.
The revision of the forecast is supporting the movement to the upside as experts are also expecting more reduction in USDA forecast.
In this framework, corn is adding 1.4% of value on Wednesday as it is pricing at 4.263. In the last three days, the grain has advanced near to 6.5% from June 10 low at 4.030 to today’s highs at 4.285.
If the unit is able to break above the 4.300 resistance, it will find next resistance at 4.355, June 2016 highs.
Wheat also tests highs
Prices of wheat are trading higher on Wednesday for the third day in a row as investors are digesting the USDA crop progress report.
On Wednesday, wheat jumped to reach fresh highs since February 6 at 5.235. Then, the unit tempered its gains and returned to trade at current levels around 5.185, 1.10% gains on the day.
Technical studies suggest more room for the upside with the 5.250 as immediate resistance. Above there, check for 5.400 area and 5.550 as most significant buying zones.