Corn, wheat down ahead of weekly crop numbers
Soybeans were mixed on spread adjustments. It was an up and down day, with uncertainties about demand from China and a lower move in bean meal pulling contracts down from the day’s highs. In response to Friday’s comments from President Trump, Beijing has reportedly told state-run companies to suspend imports of some U.S. goods, including soybeans. The tensions include China’s Phase One trade agreement purchases, or lack thereof, how each nation handled coronavirus, and the recent U.S. comments on China’s actions in Hong Kong. China has recently purchased U.S. beans, but could cancel, and has also been picking up beans from Brazil as a hedge, even with U.S. prices at an advantage over Brazil. As of Sunday, 75% of U.S. soybeans are planted, compared to the five-year average of 68%, and 52% of the crop has emerged, compared to 44% on average, with 70% of U.S. beans in good to excellent condition. The USDA’s 2020 planted area totals and quarterly stocks numbers are out on the 30th. The USDA says the soybean crush for April was 183 million bushels, 9 million less than the previous month, but 11 million more than a year ago. Weekly export inspections were less than what’s needed to meet USDA expectations for the 2019/20 marketing year, which runs through the end of August. Soybean meal was lower on a lack of follow through buying and product spread adjustments, which support bean oil.
Corn was modestly lower on fund and technical selling. Corn was getting ready for the USDA’s weekly crop numbers, expecting planting to be around 95% complete. The USDA says 93% of corn is planted, compared to 89% on average, with 78% emerged, compared to the usual pace of 73%, and 74% of the crop is in good to excellent condition, up 4% on the week. Crop weather generally looks favorable for late planting and early development. The USDA’s corn for ethanol use numbers for April were also out Monday, with the monthly total at 245 million bushels, a drop of 40% from March and 44% from April 2019, with DDGS production of 1.01 million tons, down 38% on the month and 45% on the year. Ethanol futures were mostly firm. Weekly export inspections were just above what’s needed to meet USDA projections for the marketing year. Corn is looking at more export competition from Argentina and Ukraine. Ukraine’s Ag Ministry says corn exports for the first 10 months of their marketing year are 28.4 million tons. Dry weather is lowering estimates for Brazil’s second crop and the spread of COVID-19 in Brazil is expected to have an impact on shipping.
The wheat complex was lower on fund and technical selling. The global fundamental situation for wheat is neutral to bearish, with crop concerns in some areas canceled out by good outlooks for others. France’s AgriMer says 56% of that nation’s soft wheat crop is rated good to excellent, down 1% on the week and the lowest rating in nearly a decade. Stateside, a warmer, drier weather pattern could stress the U.S. hard red winter crop but is expected to benefit soft red winter and could allow some areas to finish up spring wheat planting. For winter wheat, 77% of the crop has headed, compared to 81% on average, and 3% is harvested, compared to 2% for the five-year average, with 51% of the crop rated good to excellent, 3% below a week ago. For spring wheat, 91% is planted and 67% has emerged, both behind normal, and 80% of the crop is in good to excellent shape, 6% more than a year ago. Weekly export inspections were down on the year, but wheat has already passed the needed level for the 2019/20 marketing year. That marketing year officially wrapped up May 31st, but there are a few reporting days remaining. The USDA’s next set of supply and demand estimates is out June 11th. Ukraine’s Ag Ministry says grain exports since the start of the marketing year on July 1st, 2019 are a record 54.1 million tons, up 17.4% on the year, including 20.2 million tons of wheat.