Market News

Grains, oilseeds down on profit taking, higher dollar

Soybeans were sharply lower on profit taking and technical selling. Most near-term forecasts look warm and dry, which should help early harvest activity, and the broader markets were very bearish for commodities. The broader markets responded to coronavirus concerns and articles published over the weekend alleging extreme financial improprieties at some of the world’s largest banks. China and unknown destinations each bought 132,000 of 2020/21 U.S. soybeans and Pakistan picked up 171,000 tons, with 12^th business day in a row with an announced sale for a running total of 4,710,500 tons. Weekly inspections were bullish. The USDA says 63% of U.S. soybeans are rated good to excellent, unchanged on the week, with 59% dropping leaves, compared to the five-year average of 50%, and 6% harvested, matching the normal pace. Soybean meal and oil followed beans lower. IHS Markit is projecting 2020 U.S. soybean production at 4.306 billion bushels with an average yield of 52.1 bushels per acre and sees 2021 U.S. soybean acreage at 87.1 million acres with a crop of 4.481 billion bushels and an average yield of 52.0 bushels per acre.

Corn was lower on profit taking and technical selling, in addition to the outside market activity. Corn is also watching harvest activity, expecting the USDA to report a solid advance in the weekly numbers. As of Sunday, 61% of corn is in good to excellent condition, up 1%, with 95% of the crop dented, compared to 90% on average, 59% mature, compared to 49% usually this time of year, and 8% harvested, compared to the normal pace of 10%. Planting is underway in South America, with 10% of Argentina’s crop planted and Brazil expected to increase planted area. 4% of France’s corn crop is harvested with 59% of the crop in good to excellent condition and production estimated at 64.9 million tons. Ethanol futures were lower. Weekly export inspections were bullish. IHS Markit pegs 2020 U.S. corn production at 14.888 billion bushels with an average yield of 178.7 bushels per acre and estimates 2021 U.S. planted area for corn at 93.7 million acres with production of 15.607 billion bushels and an average yield of 181.0 bushels per acre.

The wheat complex was sharply lower on profit taking and technical selling, along with the higher dollar. The supply fundamentals are bearish, but there are concerns about dry weather in the Black Sea region. Parts of Ukraine could see rain, but most of southern Russia is expected to remain dry. The trade is also keeping an eye on forecasts for rain in parts of Argentina’s wheat growing region. Stateside, wheat is monitoring winter wheat planting conditions. For winter wheat, 20% of the crop is planted and 3% has emerged, both 1% ahead of their respective averages. For spring wheat, 96% is harvested, matching the typical pace. Weekly export inspections were bullish. DTN says Jordan is tendering for 120,000 tons of milling wheat. IHS Markit sees 2021 U.S. winter wheat planting at 30.9 million acres with non-durum spring wheat at 12.95 million, both up on the year.