Market News

Corn, wheat up as soybeans sell off

Soybeans were lower on profit taking and technical selling. Planting is ahead of average, with warm, dry weather expected in the central and eastern Midwest over the next week. It’s early, but that could cause some stress in those parts of the region. Parts of the Plains that badly need rain could see limited precipitation during that time frame. Longer term outlooks for the region are more friendly, including the possibility of increased rainfall in mid to late summer. USDA’s next set of supply, demand, and production numbers are out June 9^th. Soybean meal and oil were down on profit taking. Brazil remains in control of the export market, but their prices have firmed up post-harvest, which could help U.S. sales. The 2023/24 marketing year for beans, and corn, starts September 1^st.

Corn was higher on short covering and technical buying. U.S. corn planting is 81% complete, with some key states nearly wrapped up. If the weather forecasts for the next week hold up, national activity could be very close to over for the year. The USDA’s first national corn condition rating of the season will be in next week’s update. That will be out on Tuesday the 30^th with markets and most USDA offices closed for Memorial Day on Monday. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out this Wednesday. Corn for ethanol demand continues to be a relative bright spot for the market. Conditions for development of Brazil’s second crop are generally favorable with early harvest activity not that far off in some growing areas. U.S. corn has not seen the expected spike in demand with some buyers, including China, holding off or canceling U.S. corn while waiting to see the quality and availability of Brazil’s second crop.

The wheat complex was higher on short covering and technical buying. Wheat continued to bounce off the recent lows, expecting a big increase in hard red winter abandonment following widespread drought in the central and southern U.S. Plains. Soft red winter wheat remains in comparatively good condition. Spring wheat planting in the northern U.S. Plains is slow and the crop might lose some acres. The trade also has an eye on dry weather concerns for planting in Argentina, Canada, and Russia. Russia continues to dominate the export market because of the extremely cheap price when compared to major competitors. Ukraine is still exporting grain, just at lesser amounts as supplies run thin and planted area is impacted for the second year in a row by the war with Russia. Additionally, Russia has slowed inspections of Ukrainian vessels at previously agreed upon ports and halted loading altogether at one of those ports, while also reportedly stealing grain.