Markets are trading mixed this morning with news that a trade deal had been reached with Japan providing some support for the corn and bean markets while wheat is giving back a portion of the gains that we saw yesterday.

Managed funds on Tuesday were estimated as net sellers of 6k corn to push the net short back out to 177k, net sellers of 2k beans to push the net short out to 17k, and net buyers of 3k wheat to reduce the net short to 57k.

South Korea trade reps are reportedly looking at the U.S./Japan trade deal and looking to make a similar agreement. They are expected to exclude rice and beef imports, but are considering imports of crops for fuel, such as corn for ethanol.

December corn posted a lower low, lower high, and lower close on Tuesday with the market continuing to retrace last week’s gains. Directional and overbought/sold indicators are neutral with support at 4.18 and resistance 4.35.

Beans posted a lower low, lower high, and lower close Tuesday, but the market is recovering those losses with the gap from Sunday night a potential upside target for today at 10.35. Directional indicators are neutral with support 10.10 and resistance 10.35.

Corn is seeing a quiet trade overnight after a softer start to the week. The Japan trade deal should be good for corn demand, but a major impact on Japan’s corn imports is unlikely as they already buy a lot of corn from the U.S. A low still looks to have been put in place last week with buyers expected to emerge on the current pull-back.

Beans are catching a small bid overnight with the U.S./Japan trade deal sparking some buying. The global bean supply is still projected at comfortable levels with the U.S. bean crop expected to remain well-watered as we head into the critical portion of the growing season. Producers can look at option strategies to establish floors with upside.

Corn up ½

Beans up 5-6