Soybeans, corn, wheat give back some gains
Soybeans were modestly lower on profit taking and technical selling. Beans did start higher, following through on the post-USDA report strength, watching development conditions, but sold off slightly near the close. Many areas should see non-threatening weather, but there are areas of concern, particularly in northern and northwestern growing areas. Weekly old crop export sales were bearish, but the pace remains well ahead of last marketing year, and new crop sales were 61.4 million bushels, led by China and unknown destinations. Soybean meal was higher and bean oil was lower, adjusting product spreads. The USDA says the May soybean crush was 174 million bushels, up 10 million from April, but down 6 million from May 2020. Malaysian palm oil prices moved higher Thursday in response to India reportedly opening up for palm oil imports over the next six months, while lowering their export tax.
Corn was mixed, mostly modestly lower, adjusting spreads. Corn was also watching the weather, with conditions possibly trimming production potential in some areas. Weather in July will be watched very closely. Given how tight the supply is, a trend-line or better yield is critical for this year’s crop, which is also true for beans. Closing in on the final two months of the marketing year, old crop corn exports were bearish, but shipments continue to be strong, and it was a quiet week for new crop. Ethanol futures were unchanged. The USDA says May corn for ethanol use was 447.558 million bushels, up 10% from April and 49% from May 2020, with DDGS production of 1,938,766 tons, an increase of 10% on the month and 56% on the year. Ukraine’s state weather group estimates 2021 corn production at 37.1 million tons. Ukraine has played a bigger role in the export market over the past few years and, along with the U.S., is expected to pick up some of Brazil’s market share. CONAB’s new estimate for Brazil’s corn crop is out July 8th.
The wheat complex was lower on profit taking and technical selling. Most forecasts have more dry weather for spring wheat, including Canada, while near-term winter wheat harvest delays are an issue in some areas. The USDA’s new U.S. and world production numbers are out July 12th in the monthly supply and demand report. Ukraine’s state weather group estimates 2021 wheat production at 28.5 million tons, with total grain production at 75.8 million tons, compared to 65 million a year ago, with the group citing improved weather. About a month into the marketing year, 2021/22 wheat export sales are trailing the early 2020/21 pace. DTN says Turkey bought 395,000 tons of milling wheat and Tunisia picked up 100,000 tons, both optional origin.