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Corn, wheat up ahead of WASDE report

Soybeans were mixed. Most of the Midwest is expected to see warmer, drier weather in the near-term, allowing for more fieldwork ahead of widespread soybean planting. Still, early planting delays are probable in some key U.S. growing areas. It was an up and down day, with spillover from a lower move in bean meal, which was pressured by demand questions. Soybean oil was mixed, mostly firm, on bear spreading. Weekly export inspections were up on the week, down on the year, with China and Germany leading the pack. Just over the halfway point of the marketing year, 2022/23 inspections are ahead of 2021/22. Brazil’s record harvest is nearly complete, while prospects for Argentina generally remain dire. Tuesday, in the monthly supply and demand update, analysts expect the USDA to tighten U.S. and world ending stocks, raise the production guess for Brazil and cut the outlook for Argentina. CONAB’s updated projection for Brazil is out Thursday morning, along with the weekly U.S. export sales numbers.

Corn was higher on short covering and technical buying. Corn was watching the U.S. planting pace ahead of the weekly crop progress and condition numbers. The USDA says 3% of this year’s crop is planted, compared to the five-year average of 2%. Planting delays are expected in parts of the northern U.S. Plains and southeastern Corn Belt. Drought could also cause some delays in parts of the central and southern Plains. Corn is also watching development weather in Argentina and Brazil. Corn export inspections were below last week and last year, mainly to Mexico and China. Export demand has improved, but it will take a much faster pace of shipments for the USDA to not lower their export outlook in upcoming supply and demand reports. Ahead of Tuesday’s WASDE report, analysts see lower U.S. and world ending stocks, along with a higher crop guess for Brazil and lower production estimate for Argentina.

The wheat complex was higher on short covering and technical buying, with Kansas City taking the lead. The southwestern Plains should see more hot, dry conditions, further limiting hard red winter potential and impacting abandonment, while southeastern growing areas are generally experiencing much better weather for soft red winter. The trade is also monitoring likely planting delays in the northern Plains. For winter wheat, 27% of the crop is called good to excellent, 1% lower than a week ago and down 5% from a year ago, with 7% of the crop headed, compared to 4% on average. For spring wheat, 1% is planted, compared to 4% normally this time of year. U.S. export inspections were above the previous week, but below this a year ago, primarily to Japan and Thailand. With just under two months remaining in the current marketing year, physical shipments have been in-line with what’s needed to meet USDA projections. The trade continues to monitor Russia’s war with Ukraine, while waiting to see if Moscow extends the Black Sea Grain Initiative again. The USDA Tuesday is expected to raise domestic ending stocks and leave the world supply nearly steady. Any changes to the global production numbers will be watched very closely.

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