Soybeans down, corn mixed, watching weather
Soybeans were lower on fund and technical selling but did manage to finish near the upper end of the day’s range. Parts of the region have recently received rain with a chance for more later this week, but with uncertainties about coverage in the northern Plains. The trade is also waiting to see what the USDA’s planted area and quarterly grain stocks numbers next week show. China and unknown destinations did buy more new crop U.S. beans ahead of the open, 132,000 and 260,000 tons, respectively. The week to date total is 1.178 million tons, with 798,000 tons of that purchased by China. Weekly old and new crop export numbers were nominally bearish as Brazil continues to dominate the market, but the 2020/21 U.S. pace remains on track to meet USDA projections. China did buy 66,000 tons of old crop U.S. beans last week while cancelling on 66,000 tons of new crop. The 2021/22 marketing year starts September 1st. The International Grains Council has 2021/22 world soybean production at 383 million tons, unchanged from May and up from the anticipated 2020/21 total of 363 million tons. Soybean meal was lower and bean oil was higher on product spread adjustments, cash basis trends, and demand expectations. Argentina’s Ag Ministry says producers have sold 22.5 million tons of the 2020/21 crop, compared to 25.2 million tons of 2019/20 this time last year.
Corn was mixed, mostly firm. Corn is also watching the weather, wary about a lack of coverage in some areas and the potential for damage from severe storms. That said – the trade is anticipating at least some improvement in the USDA’s crop condition rating in next Monday’s crop progress and condition update. The USDA’s quarterly hogs and pigs numbers were expected to imply lower feed demand. March to May farrowings and June through November farrowing intentions projections were all down on the year. Old crop export sales were up solidly on the week, China and Japan were the leading buyers but there was a big cancellation by unknown destinations, while new crop sales topped 300,000 tons thanks to unknown. Ethanol futures were unchanged. The International Grains Council pegs 2021/22 world corn production at 1.201 billion tons, compared to 1.192 billion in the prior report and the 2020/21 projection of 1.131 billion tons. The trade is also monitoring harvest activity and development conditions for Brazil’s second crop. The USDA’s next set of world production estimates is out July 12th in the monthly supply and demand report.
The wheat complex was mixed, mostly lower. Spring wheat growing areas have received rain, just not nearly enough to break drought conditions, providing some support to nearby Minneapolis. Chicago and Kansas City were down even as the winter wheat harvest is being delayed in some areas. Globally, parts of Canada and Russia do need rain. The International Grains Council estimates world production at 789 million tons, compared to the last guess of 773 million and the projection of 773 million for 2020/21, with an increase in trade and that slightly lower production guess leading to a month-to-month reduction in the carryover estimate. SovEcon sees Russia’s crop at 84.6 million tons, up 2.2 million from the prior estimate. Weekly U.S. export sales were above a week ago, unknown and Mexico were the leading buyers, but the 2021/22 pace is off to a slow start when compared to 2020/21. DTN says Japan bought 159,665 tons of food wheat from the U.S. and Canada. China reportedly bought wheat from Australia despite ongoing trade tensions. No amount was reported.