Market News

Commercial demand props up corn, wheat

 

Soybeans were mixed, mostly fractionally higher, rallying from early losses on late, light commercial buying, along with spillover from the higher bean meal. The trade’s watching South America and while Brazil looks mostly good, there are still concerns about Argentina. Forecasts have a chance for rain in dry parts of South America this week, but longer term outlooks remain uncertain with La Nina conditions expected to last through summer in the southern hemisphere. According to wire reports, new crop soybean sales in Brazil remain slower than average because of low prices. Unknown destinations bought 130,000 tons of new crop U.S. beans. Weekly U.S. export sales numbers are out Friday. Soybean meal was higher and bean oil was lower on commercial spread adjustments.

Corn was modestly higher on commercial and technical buying, bouncing off the recent lows. There is buying interest at these price levels, but the large available supply should continue to keep contracts inside the recent range. Also, a sustained rally would probably spark new farmer selling. Corn is watching weather in South America, not only for the impact on first crop, but also for any effects on second crop corn. Brazil’s AgroConsult expects the second crop acreage to meet expectations, even if planting is delayed. Ethanol futures were mostly lower. The weekly EIA production and stocks numbers are out Thursday, delayed by Monday’s holiday.

The wheat complex was modestly higher on commercial and technical buying. The fundamentals are bearish, but wheat has interest at these price levels. Bitterly cold conditions in parts of the Midwest and Plains should ease over the next few days, but drought or near drought conditions persist on much of the Plains, with only limited precipitation expected in many areas. Egypt bought 295,000 tons of milling wheat from Russia and South Korea’s Nonghyup Feed purchased 65,000 tons of feed wheat. Via the USDA’s Foreign Ag Service, Russia is subsidizing rail movement to “stimulate the export of grain”, in addition to stabilizing prices and helping producers’ bottom lines. The FAS says the measure will stay in place through the end of June.