Corn up on new demand

Soybeans were mixed on old crop/new crop spread trade. The near term supply remains tight and domestic and export demand both continue to look solid, supporting the nearbys, but deferreds were pressure by the longer term fundamentals. Crop conditions around South America are generally pretty good, with harvest underway in parts of Brazil, and the trade expects a big production estimate on Friday. Soybean meal was higher on product spread trade and talk that China rejecting U.S. DDGs could lead to increased bean meal demand. Bean oil was lower on those spread adjustments and the losses in crude oil.

Corn was higher on fund and commercial buying. Mexico bought 110,600 tons of 2013/14 U.S. corn, and weather’s limiting barge movement while leading to talk of increased feed demand. That said – there’s a chance for rain in dry parts of Argentina later on this week, and on Friday, USDA’s expected to report a record U.S. crop. Ethanol was higher. According to China’s Xinhua News Agency, Beijing rejected 610,000 tons of U.S. corn and corn products in 2013 due to GMO content. Bloomberg notes a shipment of corn from Ukraine arrived about the time reports of cancellations started going widespread.

The wheat complex was mixed, pretty much taking the path of least resistance. There’s some very cold weather around the U.S. with the potential for cold stress on the dormant crop in the Plains and Midwest. Unknown bought a total of 160,000 tons of 2014/15 U.S. wheat, 128,000 tons hard red winter and 32,000 tons soft red winter, and winter wheat planted area estimates are out Friday. Friday’s purchase of 535,000 tons of wheat Friday was their largest since 2010 and while it didn’t contain any U.S. wheat, that much wheat off the market at one time could be a signal of demand down the road. Algeria purchased 500,000 tons of optional origin wheat, which DTN says is probably French.

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