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New crop corn, soybeans post more losses

Soybeans were lower on fund and technical selling. The trade continued to largely shrug off near-term conditions in favor of the forecasts for widespread rain later this week and early next week. Some stress is likely, but timely rainfall will limit the impact. The USDA’s national soybean rating was down on the week, while that warmer, drier weather has sped up planting and development. The trade is waiting to see just how many acres get planted this year, with the official USDA total out June 30th, along with quarterly stocks. Brazil continues to control most of the export market, but demand was strong much earlier this marketing year and while the USDA did raise U.S. ending stocks last week, they are still projecting an historically tight supply this and next marketing year. The new marketing year for soybeans, and corn, gets underway September 1st. The NOPA says member firms crushed 163.521 million bushels of soybeans during May, slightly less than expected and below year ago levels, likely due in part to demand rationing. Soybean meal and oil were lower, following beans.

Corn was mostly lower, except for the nearby July contract. Corn was also watching the weather and the expected benefits of a shift to a cooler, wetter pattern in some areas. The USDA says the national corn condition rating posted a week-to week-decline, including a big drop in Iowa, while emergence is nearly complete. Most forecasts have more dry weather in central Brazil, limiting the potential of their critical second crop. That will limit their export business, likely sending some sales to the U.S. and Ukraine. Brazil’s government will reportedly allow imports of GMO corn from the U.S. to make up for the shortfall in production and limit further price inflation. China continues to be a wild card for the export market. Beijing has purchased routine amount of old crop U.S. corn recently, but hasn’t made any significant new crop buys, despite the huge premium of their domestic prices to the U.S. The USDA’s attaché in Ukraine estimates 2021/22 production at 36.654 million tons, less than the current official guess of 37.5 million, but well above the 2020/21 total of 30.297 million tons. 2021/22 exports are seen at 34 million tons, compared to the most recent estimate of 30.5 million and the 2020/21 total of 21.5 million tons. Ethanol futures were unchanged. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday.

The wheat complex was mixed, with Chicago and Kansas City down and Minneapolis mostly modestly higher. Spring and winter wheat conditions both declined on the week, while the Dakotas might not see the expected weekend rain, which pulled Minneapolis into a mostly firm close. Global crop conditions generally look favorable, but some spring wheat growing areas in Russia will need timely rainfall. The USDA’s next set of official global production projections are out in the supply and demand report scheduled for July 10th. The USDA’s attaché for Ukraine has the 2021/22 wheat crop at 29.467 million tons, compared to the official estimate of 29 million and the 2020/21 total of 25.420 million tons. Exports for the 2021/22 marketing year are projected at 20.5 million tons, a half a million more than the last official guess and up solidly from the 2020/21 total of 16.35 million tons. DTN says South Korea bought 65,000 tons of feed wheat, adding there are a few new tenders: Japan is in the market for 207,472 tons of food wheat from the U.S., Australia, and/or Canada and the Philippines is looking for 130,000 tons of milling wheat, along with 75,000 tons of food wheat.

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