The corn market trend indicators remain confused, according to Grain Farmers of Ontario.
The weekly GFO market commentary says there are positive short-term signals, mixed on the medium term while the main trend remains negative.
Analyst Marty Hibbs says the March 10th WASDE report's corn ending stocks number was on the low end of what the trade had estimated.
Hibbs reports the soybean market reacted negatively to the WASDE report.
Traders had apparently expected the U-S carryout to be reduced.
GFO has all the soybean market chart indicators negative, with Hibbs saying once again that any rallies should be viewed as selling opportunities until there's a trend change.
He says the USDA report had lower wheat ending stocks than the trade had expected.
The commentary suggests wheat seems to be searching for a bottom at the $4.70 level.
GFO has all three chart indicators negative for wheat.
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Grain Farmers of Ontario Market Commentary:
CORN: The March 10 United States Department of Agriculture (USDA) report showed corn feed and export demand up 50 million bushels each, while ethanol usage and overall carryout dropped by 50 million bushels. The resulting 1.777 billion bushels is right on the low end of the trade estimate range. World corn 2014/2015 carry in and production both fell around 1.7 million tonnes, leaving ending stocks down 4.4 MMT. On the charts: You can look all the way back to the beginning of October 2014 and see corn trading at the same level on the Chicago Board of trade. This equates to a six month sideways market and there is still no direction as to which way we are headed. Our trend indicators remain confused and we see a positive short term signal, mixed with a medium term signal, but the main trend remains negative. I still expect the March 31 USDA report will set the tone for the next few months.
SOYBEANS: The March 10 USDA report showed both U.S. and world balance tables virtually unchanged with U.S. carryout steady at 385 million bushels, and global production exactly even with world stocks up 270 thousand tonnes. Beans initial reaction was negative due to the U.S. carryout not being reduced. On the charts: Staying the course, we see all trend indicators pointing south; however,this does not mean we can’t get a bounce in prices. As we have indicated over the past few months, we feel that any rallies should be viewed as selling opportunities until we get a trend change. The USDA report due out on March 31 just might give us something to shake things up. The main trend is still down.
WHEAT: Keeping with the March 10 USDA report, the U.S. wheat ending stocks came out at 691 million bushels, down one million from the February report. The trade expected 699 million bushels. On the charts: Continuing from earlier this month, March 5 saw a retest of the March contract low of $4.81. So far this is holding, but a quick look at the weekly charts shows a more substantial support level at our $4.70 level as we previously indicated. For the time being, it seems that wheat is searching for a bottom at these levels, but the March 31 report will be the judge of whether or not we finally find that bottom. For the time being, all three indicators are still negative, thus confirming that this downtrend remains intact.
Marty Hibbs, Grain Farmers of Ontario
