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Soybeans, corn up on weather concerns, outside markets

Soybeans were higher on fund and technical buying, ending the week mixed, with nearby contracts up and deferred months down. Generally warm, dry weather in much of the Midwest should help planting but could cause early stress in some areas. Weekly old and new crop export numbers were bearish, with old crop sales at 4.5 million bushels and new crop at 11.1 million. There were no reported old crop sales to China with Indonesia the top buyer against a small cancellation by unknown destinations, and while China and Mexico did buy new crop U.S. beans, those could be canceled if prices aren’t favorable. Shipments have slowed down, with Brazil continuing to control the market. The 2023/24 marketing year for soybeans, and for corn, gets underway September 1st. Soybean meal exports were decent, benefitting at least to some extent from Argentina largely being out of the product market, while soybean oil sales are inconsistent due to shifts in global vegetable oil demand. Soybean meal was lower and bean oil was higher on the adjustment of product spreads. Bean oil had additional support from the gains in crude oil.

Corn was higher on fund and technical buying, rallying at midday and pulling contracts to a higher finish for the week. Corn is watching the weather, with those generally dry conditions in the Midwest against better rain in the Plains. Forecasts into the middle of June are generally dry, potentially causing some stress in parts of the region. The broader markets contributed to the gains following the Senate passage of the debt ceiling deal and better than expected May jobs numbers. Old crop export sales were down on the week, mainly to Mexico and Colombia with a cancellation by unknown, while new crop sales were routine, with Mexico topping the list. The USDA’s 2023 next set of supply and demand numbers are out on the 9th and planted acreage totals are scheduled for the 30th, along with quarterly grain stocks. Corn is also keeping an eye on the early harvest activity for second crop corn in Brazil.

The wheat complex was higher on fund and technical buying Friday, while closing mixed for the week. The complex is watching early winter wheat harvest activity and the tail end of spring wheat planting. Contracts are oversold, but wheat continues to deal with slow export demand, which should limit any significant, long-term upside. The global 2023/24 crop is expected to be smaller than 2022/23, which could improve demand for U.S. wheat. Still, that’s a big unknown right now and Russia continues to dominate the export market. The trade is keeping an eye on potential damage from recent heavy rainfall in parts of China and Russia, along with the limited planting in Ukraine and potential disruptions for trade out of the Black Sea region. With just a few reporting days left in the marketing year, old crop U.S. sales were a marketing year low, while new crop sales were good, mainly to unknown destinations and South Korea.

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