Market News

Soybeans, corn down, pressured by USDA numbers

Soybeans were modestly lower on commercial and technical selling. The USDA raised estimates for U.S. ending stocks and South American production, along with the export guess for Brazil. The import estimate for China was also up on the month. Even if the supply is growing, demand should stay solid, which helped pull contracts off of the lows. Soybean meal was higher and bean oil was lower on the adjustment of product spreads. The USDA’s new soybean production estimate for Brazil is above CONAB’s current 110.2 million tons, which was also updated Tuesday. China’s Ministry of Ag increased its 2016/17 soybean import estimate to 86.55 million tons, slightly less than the current USDA guess. A slowdown in U.S. corn planting could delay soybean activity in some areas, but that’s mostly on the back burner.

Corn was fractionally lower on commercial and technical selling. U.S. corn ending stocks were unchanged with solid demand expectations, but that anticipated supply is still pretty big at more than 2.3 billion bushels. USDA also increased production and export outlooks for Argentina and Brazil. CONAB also updated its production estimates for Brazil Tuesday, putting the combined first and second corn crops at 91.5 million tons. China’s Ag Ministry now projects 2016/17 corn imports at 1 million tons, compared to the USDA’s current projection of 3 million tons. Nearby ethanol futures were steady to firm. Corn’s also watching planting conditions in the Midwest. There are concerns about delays, but it’s very, very early.

The wheat complex was modestly higher on short covering and technical buying. U.S. and world wheat ending stocks were both up from March, reflecting the bearish fundamental outlook. Minneapolis led the way up on an oversold bounce. DTN says South Korea bought 63.000 tons of feed wheat and Japan is tendering for 126,405 tons of food wheat from the U.S., Australia, and Canada. CONAB expects lower wheat acreage this year because of low prices and the quality of last year’s crop. The USDA’s attaché in Turkey sees 2017/18 wheat production at 18 million tons.