Market News

Corn, soybeans, wheat down ahead of USDA numbers

 

Soybeans were modestly lower on fund and technical selling. Weekend rainfall totals in South America were mixed, generally good in central Brazil, scattered in southern Brazil, and mostly dry for Argentina. It’s roughly early to mid-June for crops in the southern hemisphere. Analysts expect minimal changes to most of the soybean numbers, domestic and international, in Tuesday’s supply and demand report. Unknown destinations bought 132,000 tons of 2017/18 U.S. beans, but it was another bearish week for inspections. Quarterly grain stocks numbers are out in January. Soybean meal and oil were lower on spillover from beans and the fundamental implications of big South American crops. AgRural now sees Brazil’s soybean crop at 112.9 million tons, compared to November’s USDA projection of 108 million.

Corn was modestly lower on fund and technical selling, with March ending the day just above its’ contract low. Corn was also watching South America and while there are concerns about dry conditions in some areas, it’s early in their growing season. AgRural estimates Brazil’s second corn crop at 19.7 million tons, down 500,000 from the prior projection because of lower planted area. Mexico bought 110,000 tons of 2017/18 U.S. corn, but export inspections were bearish. Mexico’s the biggest buyer of U.S. corn, with some uncertainties about trade because of the issues surrounding NAFTA. Increased import demand from China because of their ethanol program could absorb some additional corn, but there are still a lot of uncertainties connected to that as well. The USDA should make minimal, if any, adjustments to 2017 U.S. production estimates, with final 2017 totals out in February. Ethanol futures were lower.

The wheat complex was lower on fund and technical selling, with March Chicago notching another new low for the move. Chicago and Kansas City led the way down on supply pressure and dry conditions in parts of the U.S. Plains probably won’t be an issue until spring. Halfway through the marketing year, weekly export inspections remain bearish. New USDA supply and demand numbers are out Tuesday and the first official winter wheat acreage estimate of the season is out in January. The USDA could make some changes to U.S. ending stocks depending on demand outlooks, but the global supply should be bearish.