WASDE Report Shows Progress but Grains up Amid Concerns on Supply

The WASDE report was finally released on Thursday and it showed some progress in grains forecasting for the 2019/20 season. However, the improvement is not enough, and grains are posting gains in the day.

Soybean shaken by WASDE report, but odds remains to the upside

Soybean is trading positive for the fourth straight day in Thursday; however, it is struggling to maintain gains, and it is now more on a daily Doji candle than a positive performance.

Price of soybeans jumped to trade at 10-day highs at 8.923, but the unit got a rejection and it is now trading at 8.881, 0.08% positive on the day.

The World Agricultural Supply and Demand Estimates recently reported showed that July’s “U.S. soybean supply and use projections for 2019/20 include lower beginning stocks, production, exports, and ending stocks.”

According to the WASDE, soybean production for 2019/20 will be at 3.845 billion bushels, down 305 million from the previous period. WASDE is considering lower planted and harvested area in the June 28 Acreage report.

Soybean traded in a rollercoaster after the WASDE release, but it remains positive. Technical conditions suggest more gains in the short term, but Thursday daily candle will show what market is thinking about.

To the upside, 9.000 is the next resistance with the 9.150 area as the frontier to break. To the downside, the unit should break below the 8.660 before thinking of more drops and a change in the short term trend.

Corn positive after WASDE

Price of corn is trading positive on Thursday following a brief rollercoaster following the publication of the WASDE report.

The WASDE report is informing that corn outlook for the 2019/20 season is for larger production and beginning stocks. “Corn beginning stocks are raised 145 million bushels, reflecting lower use forecasts for 2018/19.”

The report also highlighted that corn production for 2019/20 projects to be 195 million bushels higher to 13.875 billion. “Excessive rainfall prevented planting at the time of the Acreage survey, leaving a portion of acres still to be planted for corn in a number of major producing states.”

Corn is extending gains for the second day in a row after the 4.200 area supported the unit in both days. Currently, prices of corn are moving at 4.311, 0.85% positive on the day.

Wheat jumps after WASDE report and Japan purchases

Prices of wheat are trading higher following the latest WASDE report released on Thursday. Also, news from Japan where the country bought 98,705 tonnes are fueling the grain.

According to the WASDE, wheat will perform “lower supplies, higher domestic use, larger exports, and reduced stocks,” in July.

Forecast for wheat production for the 2019/20 season rose only 18 million bushels to 1,921 million. “The all wheat yield is forecast 1.3 bushels per acre higher at 50.0 bushels.”

In this framework, wheat jumped over 2.3% on Thursday to recover the 5.000 area. Then, to test the 5.135 level, highest since July 1. Technical indicators are showing mixed signals, but the chart pattern is showing that a break above current levels would fuel a run towards the 5.200 area, where the 20-day moving average is.