Strength in soybeans yesterday was on renewed optimism from traders that China would return as a larger buyer of U.S. agricultural products after comments were made by trade officials. Rumors say that China said they would purchase an additional $30B a year of our grain products, such as beans, corn and wheat if a trade deal with U.S. is finalized. Support was also seen from the USDA estimate for 19-20 soybean acres at 85 million compared to 89 million last year and average estimate of 86.1 million. March beans have traded in a 38-cent range so far for the month of Feb, but for the week, the market is up just over 3 cents. Resistance comes in at 919 and 926 with support at 902 and 893.
The corn market is in a position to see a major rally if China is a significant buyer of U.S. corn. The USDA released their first look at the new crop season with ending stocks pegged at 1.65 billion bushels, down from 1.735 billion. If China purchases 250 million bushels, this would leave ending stocks sharply lower. Similar to the beans, the market was supported by the news of China possibly buying $30B in agricultural products. Resistance comes in at 378 and 384 with support at 371 and 366.
Soybeans Mar ’19 Daily Chart
Corn Mar ’19 Daily Chart
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