The rally continues. Prices firmed overnight in the soy complex with beans and meal once again taking charge to the upside. Soyoil futures trades higher on the back of firmer crude and other world vegoils. Rapeseed prices hit a record high and palm oil is firmer. Bean basis bids remain firm supported by demand for near term supplies. Buy-stops were triggered yesterday allowing prices to rise without much resistance to stop them for beans and meal. Funds purchased 5000 wheat, 5000 corn, 6,000 beans, 4000 meal, and 4000 soyoil yesterday extending length across the board. Corn finally tops $6.00 this morning following bean strength and crude oil firmness. Also helping to continue the enthusiasm are comments from the Biden Administration that they would likely not be imposing covid lockdowns in response to the latest variant.

Weather has also turned friendly with more warm and dry conditions, and more analysts lowering crop expectations. Traders continue to look at mostly dry conditions in the problem spots in Brazil, Uruguay, and Paraguay.

WEATHER – A major factor in the market now as concerns continue for most of Argentina and the southern third of Brazil, as warm and dry conditions are the norm over the next two weeks.

US southern plains remain dry which is supporting KC wheat values, with crops reported to be under stress. The Black Sea is cold with snow cover in the north, but very little in the south.

ANNOUNCEMENTS
Ukraine’s corn harvest is likely to be a record as farmers wrap up harvest. According to data from the Ukraine Ministry, corn production could be close to 32% increase vs. yr ago at 40 mmt, 11% higher than the record set in 2019 at 36 mmt.

Argentina corn plantings are behind at 48% vs. 61% of normal and beans at 65% vs. 72% normal.

Cordonnier estimated Argentine bean planting progress at 64.7%, but noted that conditions are turning drier and hotter. He estimated soy conditions at 75% good/excellent vs. 88% wk ago. Around 3% of the beans are in the flowering stage.

Calls are as follows:
beans: 13-16 higher
meal: 4.80-5.50 higher
soyoil: 40-50 pts higher
corn: 4-6 higher
wheat: 7-9 higher

Outside markets have stocks mixed as traders continue to assess the situation with the Omicron variant. Investors are also lightening up as they expect the Fed to raise interest rates in 2022. Crude oil firms to $71.77/barrel with the US dollar trading weaker at 96.60.

Tech talk:
Soy: March beans continue to trend up placing a new high at $13.25 3/4 this morning. Charts are constructive as the lower end of the trading range now appears to be $12.80. Beans often place another quick 25-30c after moving over a benchmark, as is the case this morning. Would now look for an adjusted 35-40c higher range from $12.50-$12.90 – $12.80-$13.40. March meal extends gains as well with a new morning high over $395.00. New highs beget new highs for meal, and the ADX moves up to 47 indicating strong buying interest. Pullbacks remain shallow which indicates that traders are wanting to price, own, or short-cover. Conditions are honing in on overbot, but not enough to suggest a correction is needed. Therefore look for the likelihood of zeroing in on the $400.00 level before all is said and done. March soyoil moves sideways and is taking back current losses from a trade down to 51c. Would look for pullbacks here to find buying interest, as the low of 52c now appears to be a buying opportunity for a market that could trend up towards 55-58c once again. The 200 day moving average over the market at 5650c is best resistance, but think we probably trend towards it. Would look for a new congestive 52c-58c trading range.

Grains: March corn finally trades over $6.00 to new market highs, with a very constructive chart at hand. The major path is sideways/higher, and prices could now trend up towards $6.15-$6.20. The ADX is beginning to get stronger at 25 indicating interest on corrective price action. Chart has now solidified lower support at $5.80 vs. $5.70, and the market is not yet overbot. First support levels now move up to $5.90 as we hit new highs for March corn. March wheat now confirms $7.50 as a corrective low with prices trending towards the trading range high at $8.15. While the range from the low appears to be from $7.50-$8.15, any trade over $8.25 opens the door to a test of $8.50, as there is very little back resistance to stop such a rally. Like the other markets, setbacks will now be used to cover shorts or as an opportunity to price or own.

MARCH MEAL: The uptrend continues as new highs are in place over $390.00. Target high now moves back to crossing lines of upper resistance from $408.00/$410.00. Trendline resistance for the day crosses at $395.00. The pullbacks remain shallow and until a good reversal signal is set, (outside day closing lower, key reversal, etc), have to own pullbacks. Trading range now appears to be from $360.00 to possible highs of $410.00. The rally has not yet indicated it has a stopping point with any reversal trade.

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