Market News
More commercial pressure for soybeans, corn
Soybeans were lower on commercial and technical selling. Weekly old crop export sales were bearish, but the pace remains ahead of the USDA’s projection for the marketing year at just over the halfway point. Egypt was the biggest buyer, followed by Indonesia, and while there were no reported sales to China, unknown destinations canceled on more than 150,000 tons. Unknown did buy 65,000 tons of new crop. Near-term weather for South America looks bearish. The International Grains Council expects 2020/21 world soybean production to be 361 million tons, up 1 million on the month with increases for Brazil and India cancelling out a decrease for Argentina. 2019/20 production totaled 338 million tons, while the first projection for 2021/22 is 383 million tons. The global carryover was unchanged on the month at 45 million tons, but that would be 7 million less than last marketing year. The USDA’s next set of supply and demand estimates is out April 9th. Soybean meal was higher and bean oil was lower, including a limit loss in May oil, on product spread adjustments by commercial traders.
Corn was lower on commercial and technical selling. Corn is also watching weather in Argentina and Brazil, along with conditions in the U.S. ahead of widespread planting. The USDA’s prospective planting numbers are out on the 31st, along with quarterly grain stocks. The International Grains Council estimates 2020/21 world corn production at a record 1.139 billion tons, compared to 1.134 billion in February and 1.125 billion for 2019/20. 2021/22 production is seen at 11.93 million tons, but with tighter ending stocks than either 2019/20 or 2020/21 because of strong demand. Last week was one of the largest weeks on record for corn export sales at nearly 4.5 million tons of old crop, with about 4 million of that purchased by China. Still, that was seen as old news and those sales could be canceled. U.S. corn prices are at a significant discount to China’s domestic prices, but the continued spread of African swine fever is having at least some impact on China’s feed demand. Japan bought 111,000 tons of 2020/21 U.S. corn. Ethanol futures were unchanged.
The wheat complex was lower on fund and technical selling. Winter wheat conditions are mostly good domestically and globally, while the global supply fundamentals are bearish. The International Grains Council is estimating 2020/21 world wheat production at a record 774 million tons, up 1 million from the last guess and, if realized, 12 million above 2019/20. 2021/22 world wheat production is projected at 790 million tons. The 2020/21 world carryover is pegged at 292 million tons, compared to 294 million last month and 278 million last marketing year. The European Commission sees 2021/22 soft wheat production for the European Union at 126.7 million tons, compared to 117.1 million for 2020/21, with new crop exports at 30 million tons, compared to the old crop guess of 27 million. Crop consulting firm IKAR estimates Russia’s 2021 wheat crop at 79.8 million tons, up 1.8 million thanks to good weather in southern growing areas. Weekly U.S. old crop export sales were down on the week, but above average, while new crop sales were within expectations. Dry weather in the northern U.S. Plains and Canada is expected to limit spring wheat acreage. DTN says South Korea bought 197,000 tons of food wheat in a “private deal”.
Add Comment