This week's opening (Tuesday, due to the holiday Monday) brought opening selling for the grains, with corn and wheat down hard and beans up in the latter part of the session. Rain that had been forecast for South America over the weekend was more than ample.
Central Argentina saw 60% coverage of up to 3 inches. The rain was lighter in southern Brazil, but Argentine rains were the best in three months. WXRISK.com, the ag weather site, sees 200% to 400% of normal rainfall in central Brazil -- 5 to 10 inches worth - over the next five days. This will disrupt the harvest currently underway.
Southern Brazil is more dry and rains are marginal there and in central Argentina.
Weather looks to be a neutral to slightly negative pricing source into the weekend.
This week's export inspection report confirmed an improved demand outlook. Wheat inspections were 22 million bushels versus the 18.9 last week and a 4-week average of 16. Corn was 34.7 million bushels versus 29.1 last week and the 4-week average of 31. Beans inspected for export during the period were 38.4 million bushels; the 4-week average is 37. China was in for 27 versus 25 last week.
As long as production declines continue in South America, expect demand for U.S. grains to expand as importers come to our ports as crop insurance.
The USDA Outlook form results will be released Friday; that will become an early look at what the upcoming March 30 planted acreage intention report will say. The common thinking, is, it will show greater corn acreage and less bean acres to be planted this year. This keeps a general floor under the market. The only bullish news yet to come out that's not in question is the Friday weekly export sales report, which will be bullish showing last week's big beans and corn exports.
Month-end profit taking remains a threat ahead of what should be a very bullish month in March.
Key prices to capture and buy if seen are $6.20 on May corn, $12.40 May beans and $6.00 for May wheat. To see those prices, we first have to break minor support at $6.30 for May corn, $12.52 for May beans, and $6.25 for May wheat.
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