Market News

Soybeans, corn, wheat higher ahead of WASDE report

Soybeans were higher on short covering and technical buying. The near-term supply is tight and there are concerns about dry weather in parts of the Midwest. The critical month for most soybeans is August, but any early stress would have some impact on yield. Weekly old crop U.S. soybean sales were up from the previous week, but barely over 7.5 million bushels, mainly to Japan and Germany, with new crop at less than 10 million bushels, primarily to China and Mexico. Brazil continues to hold a big share of the global soybean market. China’s government says May soybean imports were record large due to the arrival of some delayed shipments. The USDA’s updated supply, demand, and production numbers are out Friday. Analysts expect a slightly lower U.S. production guess against larger old and new crop domestic ending stocks. Soybean meal futures were mixed on bear spreading and bean oil was up awaiting the EPA’s updated renewable fuels mandate next week.

Corn was higher on short covering and technical buying. Corn is looking at a tight near-term domestic supply and a slightly better chance of rain dry parts of the Midwest over the next week. The U.S. Drought Monitor did show an expansion of drought conditions in the region over the past week, potentially causing some early stress. Old crop corn sales were below a week ago, but larger than average, with Japan and Mexico topping list and a cancellation by unknown destinations, while new crop was a net reduction due to a handful of cancellations led by Mexico. The trade is also watching Brazil, with the chance for damage to the second crop from a frost/freeze event. CONAB’s updated outlook for Brazil is scheduled for June 13th. Brazilian corn currently has a price advantage over U.S. supplies. The USDA Friday is expected to lower its 2023 U.S. production estimate and make modest changes to U.S. ending stocks projections.

The wheat complex was higher on short covering and technical buying. Hot, dry weather and expanding drought are issues in parts of the northern Plains. That follows early spring wheat planting delays due to wet, cool conditions, which have led the trade to question how many acres of spring wheat have actually been planted this year. The USDA’s 2023 planted area totals are out on the 30th, along with quarterly grain stocks. The winter wheat harvest is ongoing with Friday’s USDA production guess expected to be up slightly on the month. Old and new crop U.S. ending stocks should be above a month ago and analysts expect minimal changes to global supply numbers in this round of reports. Wheat export sales for the week ending June 1st, the start of the 2023/24 marketing year for wheat, were 8.6 million bushels, Taiwan and Colombia were the big buyers. It’s early, but 2023/24 sales are behind 2022/23. Russia continues to dominate the export market due to a big price advantage. Dry weather is a concern in some spring wheat growing areas of Russia, while recent flooding has likely caused significant damage in China and Ukraine.

Add Comment

Your email address will not be published.


Stay Up to Date

Subscribe for our newsletter today and receive relevant news straight to your inbox!