Market News

Corn, wheat manage mixed finishes

Soybeans were lower on fund and technical selling. CONAB lowered its outlook for Brazil’s bean crop, but there’s still probably room for it to fall further as harvest advances. Production is now pegged at 155.239 million tons, 3.1% below December, but, for now, still 0.4% above 2023. CONAB does expect a decline in exports because of the downgraded production guess and increased domestic biodiesel blending. Conditions in Argentina remain generally favorable. The USDA’s updated global production projections are out Friday, along with several other reports, including ending stocks, quarterly grain stocks, and the preliminary 2023 U.S. corn and soybean production totals. All of those reports will be released at Noon Eastern/11 Central. Soybean meal and oil were down on the losses in beans and the fundamental implications of big South American production.

Corn was mostly modestly lower. CONAB cut its Brazil first crop corn guess, leaving the second crop unchanged ahead of widespread planting. First crop production for Brazil is seen at 24.385 million tons, a decrease of 3.7% from last month and 10.9% under last year, with total production of 117.604 million tons, down 0.8% from the prior report and 10.9% lower than 2023. Second crop planting was already expected to be lower and could be cut further, depending on the pace of the soybean harvest. Second crop production is estimated at 91.235 million tons with a third crop of 1.984 million tons, compared to 102.365 million and 2.208 million the year before, respectively. CONAB does expect Brazil to maintain its status as the world’s largest exporter of corn during the new marketing year. The aggressive corn marketing in Brazil has cut into U.S. market share, especially to China. The U.S. Energy Information Administration says domestic ethanol stocks hit a 38-week high at 24.371 million barrels, an increase of 792,000 on the week and 571,000 on the year, with production averaging 1.062 million barrels a day, 13,000 more than the previous week and 119,000 above a year ago.

The wheat complex was mixed. Wheat remains oversold, but any upside is limited by slow export demand, reflecting Russia’s hold on the market and the relative strength of the U.S. dollar. The USDA’s weekly sales numbers are out Thursday, while the winter wheat planted area estimate will be in the slew of reports released Friday. Recent precipitation has likely boosted U.S. winter wheat conditions in many areas and while there is the potential for winterkill in parts of the region, there’s more snow coverage and any damage would not be known until the crop emerges from dormancy. Winterkill is a concern in portions of Russia and Ukraine as well. CONAB says domestic wheat production was 8.097 million tons, steady with last year, but also says quality was an issue, and raised its import guess to 6.2 million tons. The European Union says that since the start of the marketing year July 1^st, 2023, soft wheat exports are 15.8 million tons, compared to 17.8 million this time last year.