2/16/2022

After a sharp, 2-day correction to begin our week, money was extremely eager to buy shortly after the market open for the overnight session. Nothing new or fresh to really trade as we continue to recycle some of the same headlines: questioning how big or small South American production will be and wondering if Russia is actually invading Ukraine or is Washington D.C. running a false-flag distraction campaign? The USDA announced the sale of 132,000 tonnes of soybeans to China for the 2022/23 marketing year this morning. Weekly ethanol numbers showed output was up 15,000 bpd to 1.01 million bpd and stocks increasing 684,000 bbls to 25.48 million barrels. To date, corn use for ethanol totals 2.462 billion bushels, an 8.4% increase from last year. This is also 40 million bushels above the pace needed to hit the USDA forecast. Brazilian soybean harvest is estimated near 25% complete. According to seasonal charts, we are hitting a time frame where we more often see a pullback in futures. Corn typically sets it's high for the year in early June and soybeans in early July. Given our current price levels, we have potential to see some big numbers trading after Spring field work is completed but none of that can be guaranteed, of course.

Corn has found short term support at the 10-day moving average and continues to trade well above the gaps set on the charts last week. We have not even come close to testing support at the gap.

The soybean daily charts show some resistance beginning to shape at the 1600’0 level. I would assume 1600’0 would immediately become support if we are able to manufacture a daily close above that mark.