After a five-day run of higher closes soybeans finally took a breather closing over 17 cents lower in the March contract. Both soybeans and soybean meal saw profit taking after hitting chart resistance, weekly exports were lackluster at 20.6 million bushels, but the biggest factor may have been the collapse of Brazil basis levels on soybeans. Vince Boddicker with Farmers Trading Company says Brazil soybeans are running well below U.S. prices. “People are saying with the basis dropping that hard maybe the Brazilian crop isn’t that tight. You put on top of that their price being over $2 cheaper than we are at current times.” He says a change in the weather forecast in South America may have also weighed on futures with the hot dry conditions in Argentina now only lasting for the next 7 days.
March corn was down a half cent closing at $4.51 ¾, also getting close to chart resistance with the 20-day moving average around $4.56. That market was also caught says Boddicker in the tug of war between lower soybeans and higher wheat. Exports were down from last week at only 37.6 million bushels.
Wheat futures clawed back after some early losses to close higher in all three exchanges, despite the stronger dollar. Boddicker says there was some classic spread unwinding between the three classes with March Kansas City wheat up 11 ¼ cents, while March Chicago wheat was only 1 ½ cents higher and March Minneapolis wheat ended up 4 ½. Talk of China looking for U.S. wheat was also supportive, while weekly exports were at 16.6 million bushels.