Soybeans soar, corn drops after acreage numbers
Soybeans were sharply higher on speculative and technical buying, pulling contracts to a higher weekly finish. Farmers planted fewer than expected soybean acres this year and quarterly stocks were below pre-report estimates. Near-term crop weather looks mixed, with increased chances of rain in some areas, but with potential for severe storms. Soybean meal and soybean oil were up on the fundamental implications of a smaller than expected U.S. crop. It’s likely those acreage numbers will change further. China bought 132,000 tons of 2023/24 U.S. soybeans, the first announced purchase of U.S. beans since late January due to Brazil’s hold over the market.
Corn was sharply lower on fund and technical selling, adding to what would have already been a sharply lower weekly finish. The USDA says corn planted area was larger than expected, the third largest on record, at more than 94 million acres. Corn will go back to watching weather Monday ahead of the weekly crop progress and condition numbers, which a day off Tuesday, July 4th. That canceled out any bullish influence from the quarterly stocks report. Corn is also monitoring second crop harvest activity in Brazil and the storage crunch caused by a record corn crop following a record soybean crop. Brazil’s government says it is buying 500,000 tons of corn to replenish state reserves.
The wheat complex was mixed, with the most active months at all three exchanges losing a lot of ground on the week. All wheat acreage was a little bit lower than expected, but up on the year, with increases for both spring and winter wheat. Winter wheat abandonment is projected at 30% of planted area, the highest since 1933. This likely means increased imports for flour millers and for feed use. The quality of the hard red winter crop is also a big concern. The trade is waiting to see what happens with the Black Sea Grain Initiative, with Moscow signaling, yet again, it is unlikely to extend that trade agreement with Ukraine.