Soybeans and corn eke out firm finishes
Soybeans were higher on commercial and technical buying. Contracts were helped out by the higher bean oil and better-than-expected economic data from China along with solid domestic demand. Soybean oil was up on Monday’s NOPA stocks number and a rally in global vegetable oils, while bean meal was mixed on bear spreading. Brazil’s record harvest is entering the late stages with their prices at a huge discount to U.S. soybeans, keeping them in control of the export market. Conversely, production projections for Argentina continue to dwindle because of weather problems. Harvest has yet to get underway in Argentina. U.S. planting is at 4%, ahead of average, but delays are expected this week in some areas. There’s the continued possibility of some producers switching from corn to beans because of these delays.
Corn was higher on commercial and technical buying after an up and down day with periodic profit taking. 8% of this year’s corn crop is planted, compared to 5% on average, with wetter, cooler conditions in the forecast for parts of the Corn Belt. Corn is also monitoring development weather for Brazil’s critical second crop, in addition to the dire conditions impacting production in Argentina. The USDA’s next round of supply, demand, and production numbers will be released May 12th. Export demand has improved and should stay in the U.S.’s favor until this summer, while domestic demand is good, with the U.S. Energy Information Administration’s weekly ethanol production and supply numbers out Wednesday.
The wheat complex was mixed, with Chicago up and Kansas City and Minneapolis down. The Black Sea grain deal might not be extended because of Russia and some central and eastern European Union members are banning imports from Ukraine to protect their domestic producers. It remains to be seen how these factors will impact U.S. exports, if at all. The real saving grace for U.S. wheat has been good domestic demand, along with a decline in production, which has also helped prop up prices. Just 27% of U.S. winter wheat is good to excellent, the lowest for this time of year in decades, and spring wheat planting is slow due to the snowpack in the northern U.S. Plains. That winter wheat rating is largely due to the continued drought or near drought conditions in the central and southern Plains, with parts of that region expected to see a frost/freeze event later this week, likely damaging the crop even further. SovEcon sees Russia’s 2023 wheat crop at 86.8 million tons, 1.5 million above a month ago, but below the record 2022 total.