Market News

Commercial demand supports grains, oilseeds

Soybeans were higher on short covering and commercial buying. Argentina’s election over the weekend could mean an increase in export competition. New President Mauricio Macri has pledged to lower the 35% export tax by 5% annually starting in 2016. China did buy 251,000 tons of 2015/16 U.S. beans Monday morning and domestic demand is solid. Soybean meal was higher, following beans, and soybean oil was almost unchanged in consolidation trade.

Corn was higher on short covering and commercial buying. This year’s corn harvest is, officially, wrapped up, according to the weekly USDA update. Export demand has been slow, but domestic demand continues to be good. Ethanol futures were steady to lower. Argentina’s new President Macri will end the government’s corn export quota, which is expected to lead to higher domestic corn acreage and larger exports.

The wheat complex was higher on short covering and commercial buying. The U.S. winter crop is heading towards dormancy in good shape. As of Sunday, 96% of winter wheat is planted, compared to the five year average of 100%, and 90% has emerged, matching the usual pace. 53% of the crop is rated good to excellent, up 1% on the week. Forecasts in the Black Sea region do have precipitation expected this week. Argentina’s new administration is expected to eliminate the wheat export quota, which is expected to increase planted area and exports. Japan is tendering for 120,000 tons of feed wheat and Jordan is in the market for 100,000 tons of optional origin wheat.