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Soybeans up, corn mostly firm on weather questions

Soybeans were higher on fund and technical buying. Parts of the Midwest got some rain over the weekend, but the precipitation missed some of the drier growing areas. The USDA says 51% of U.S. soybeans are in good to excellent condition, 3% lower than last week, with 96% of the crop emerged, compared to the five-year average of 89%, and 10% blooming, compared to 9% on average. While there could be more rain this week, coverage and totals are uncertain. The critical month for soybeans might be August, but stress and a lack of soil moisture during these early phases of development will have a negative impact on the crop’s results this fall. U.S. soybean export inspections were down on the week and the year, mainly to Mexico and Japan, with minimal movement to China. With less than a quarter left in 2022/23, the pace is slightly behind 2021/22. Brazil continues to hold a significant price advantage over the U.S. Soybean meal and oil were higher on the supply implications of a smaller than expected U.S. crop.

Corn was mixed, mostly firm. Corn is watching the weather, with concerns about early stress in parts of the Midwest and Plains. Most analysts were expecting another week-to-week decline in USDA’s good to excellent rating. As of Sunday, 50% of the U.S. corn crop is rated good to excellent, down 5%, and 4% is silking, matching the normal pace. Export inspections were below a week ago and a year ago, primarily to Mexico and Japan, with the pace slower than what’s needed to meet USDA projections for the current marketing year. The USDA could lower its export estimate in the next round of supply and demand numbers July 12th. The trade is also monitoring second crop harvest activity in Brazil. Ukraine’s Ag Ministry says corn exports since the start of the marketing year July 1st, 2022 are 28.8 million tons. The ministry sees total 2023 grain production at 46 million tons, 1 million more than the last guess.

The wheat complex was mixed. There was some rain over the weekend in spring wheat growing areas of the U.S. and Canada and winter wheat harvest weather looks mostly favorable. For winter wheat, 40% of the crop is in good to excellent shape, up 2%, with 97% of the crop headed, in-line with late June for most years, and 24% is harvested, compared to 33% on average. For spring wheat, 50% is called good to excellent, down 1%, and 31% is headed, compared to the five-year average of 25%. The USDA’s planted area totals and quarterly grain stocks reports are out Friday. Any bullishness connected to a potential disruption of Russian exports following a near coup over the weekend evaporated quickly. Moscow continues to indicate it is resistant to an extension of the Black Sea Grain Initiative with Ukraine. The current version of the deal expires in mid-July. Ukraine’s Ag Ministry says that since the start of the marketing year July 1st, 2022, wheat exports are 16.6 million tons, adding the winter wheat harvest is underway in some southern growing areas. U.S. export inspections were bearish, under last week and last year, with Yemen and Japan topping the list. While it’s early, the 2023/24 pace is behind 2022/23. The complex is also keeping an eye on planting and development conditions in Argentina, Australia, Brazil, Europe, India, and Russia.

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