CNS Canada — Soybean futures at the Chicago Board of Trade moved lower during the week ended Wednesday, while corn held steady, with South American weather conditions expected to provide much of the direction going forward.

“We’re pretty much trading one weather report at a time,” said Sean Lusk, director of commercial hedging with Walsh Trading in Chicago.

While dryness concerns in Argentina provided some support for soybeans in recent sessions, forecasts are improving in the major export nation. Early crop projections out of Brazil also remain large overall.

The December supply/demand report from the U.S. Department of Agriculture was also bearish on the surface, according to Lusk, with upward revisions to the world corn and soybean stock projections.

If there are no extensive weather concerns in South America, he saw more room to the downside for both soybeans and corn.

From a chart perspective, January soybeans see support at $10.20 per bushel, with a close under that setting a stage for a test of the $10 level, said Lusk (all figures US$). After that, the November low of $9.75 should provide support.

For corn, the March contract is watching the key level of $3.44 per bushel. If it breaks below that and the next support at $3.35 “it could be ‘bon voyage’ lower,” he said.

On the other side, corn sees resistance at $3.63 to $3.70.

“A close above $3.70 would be real bullish,” said Lusk.

— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.