soybeans corn · 2020. 12. 31. · march all supported grains and oilseeds this week. •...

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What you need to know for the week ending December 31, 2020 • The 2020 grain markets started quietly and ended with fireworks,

bookending one of the most volatile years on record in between. Corn

finished with its largest weekly gain of the year as the March contract

closed 33 cents higher than we left it Christmas Eve afternoon. Front-

month March soybeans had their 2nd biggest week of the year, closing 46

½ cents higher and settling over $13.00 for the first time since the

summer of 2014. On the year, March 2021 corn closed 73 cents higher

(96 cents higher than March 2020 corn on this date a year ago) while

March 2021 soybeans closed $3.39 higher ($3.55 higher than March

2020 beans on this date a year ago). The range on March 2021 beans

from its high (today) to its low (April 24) was a whopping $4.96.

Between record cash basis levels to start the year, African Swine Fever,

U.S./China trade negotiations, COVID-19, ethanol destruction, the Iowa

derecho, record demand, and now South American weather concerns, if

2020 taught us anything about grain markets its simply that things can

change more quickly than you’d like to believe. Good luck to everyone

as we navigate through 2021.

• The trend is up until the markets tell us otherwise. If you strictly trade

technicals, the trade action in the soybean market last Thursday and this

past Monday would have signaled at least a short-term top due to a

shooting star followed by a key reversal lower. Well, markets tend to

have a sick sense of humor, exemplified by the bean market closing over

40 cents higher the very next day. Continued dry, warm weather

forecasted in Argentina, chatter of corn demand out of China, a weak

U.S. dollar, and reports that Argentina is halting corn exports until mid-

March all supported grains and oilseeds this week.

• Argentina’s corn crop is only rated 20% good-to-excellent, as reported

by Soybean & Corn Advisor. Argentina has a large variation in

planting/harvest dates from north to south, as corn last week was only

about 61% planted vs 80% on average, while 20% of the nationwide corn

crop is pollinating, which is about half of normal due to late planting.

Weather the next few weeks will be extremely important to the crop in

Argentina as well as Brazil’s first crop soybeans. The current forecast is

stable for Brazil while Argentina trends hot and dry.

• The WASDE report on January 12 will be the next big event for the

market other than daily weather forecasts and export reports. Most of

the trade is expecting lower U.S. carryouts due to increased U.S. demand

and possibly lower final yields. Global ending stocks are also expected to

decline as South American weather has been less than ideal, especially

for Argentina. 2020/21 U.S. ending stocks estimates peaked in early

summer for corn, when USDA at that time estimated a 3.3+ billion

bushel corn carryout. They’re currently at 1.7 billion ahead of the

January report. Expected soybean carryout peaked in August at 610

million bushels. It currently sits at 175 million bushels.

Mar ‘21 Dec ‘21

$4.84 $4.34 ¾

+$0.33 +$0.10 ¼

Mar ‘21 Nov ‘21

$13.11 $11.11 ¾

+$0.46 ½ +$0.28 ½

COT Export Sales

WASDE

SPREADS (From Mar 2021 Futures)

July ’21

SOYBEANS

July ‘21

CORN

WEEKLY CLOSES & CHANGES

AT-THE-MONEY CALL OPTIONS

CORN SOYBEANS Feb $4.85 $0.1325 Feb $13.10 $0.3600 Mar $4.85 $0.2050 Mar $13.10 $0.5025 May $4.80 $0.3275 May $13.00 $0.7175 July $4.80 $0.3850 Jul $13.00 $0.8125


USELESS FACT OF THE WEEK

Originally, the Eiffel Tower was going to be erected

in Barcelona, but the project was rejected because

citizens thought it was an eyesore.


SOUTH AMERICAN WEATHER

1 Week Forecast (mm)

Past 30-Day Precipitation Anomaly (mm)

1 Week Forecast (mm)

Past 30-Day Precipitation Anomaly (mm)


SOUTH AMERICAN WEATHER


MARCH 2021 CORN

TECHNICALS

20-Day Moving Average $4.38 ½ Slow Stochastic Status Overbought

50-Day Moving Average $4.27 Stochastic %K 98.29%

100-Day Moving Average $4.02 Stochastic %D 97.86%

Contract High $4.85 ¾ Next Gap Higher N/A

Contract Low $3.31 ½ Next Gap Lower $3.57 ½ - 3.60


MARCH 2021 SOYBEANS

TECHNICALS

20-Day Moving Average $12.15 ¼ Slow Stochastic Status Overbought

50-Day Moving Average $11.58 ¾ Stochastic %K 96.32%

100-Day Moving Average $10.71 ¾ Stochastic %D 93.01%

Contract High $13.20 ¾ Next Gap Higher N/A

Contract Low $8.24 ¾ Next Gap Lower $9.05 ¾ - 9.06 ¾


MANAGED MONEY FUND POSITION

CORN

SOYBEANS

Position

+247,108 (as of 12/21)

Change From LW

-

Position

+178,352 (as of 12/21)

Change From LW

-


FRONT MONTH FUTURES – 10-YEAR NEARBY CHARTS

soybeans corn · 2020. 12. 31. · march all supported grains and oilseeds this week. •...

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