Soybeans up, corn mostly higher on weather concerns
Soybeans were higher on short covering and technical buying. 62% of U.S. beans are rated good to excellent, a low first rating of the season, but with rain in the near-term forecast for some areas. While the critical month for soybeans is August, stress during these early stages of development likely cut at least some of this year’s yield potential. Spain bought 165,000 tons of old crop U.S. soybeans Tuesday morning. That’s the first announced sale of U.S. soybeans in just over three weeks. Brazil continues to control the global soybean market, limiting demand for U.S. beans. Soybean meal was lower and bean oil was higher on the adjustment of product spreads. Global demand for U.S. soybean products has been mixed, despite top exporter Argentina having a much smaller crop this year. The USDA’s next set of supply and demand estimates is out this Friday.
Corn was mixed, mostly higher, on bull spreading. 64% of corn is called good to excellent, a drop of 5% on the week due to recent dry weather in the central and eastern Midwest and the lowest for this time of year in a decade. The states at or around 50% good to excellent include some of the top producers in the region, possibly impacting yield. That said – there’s a long way to go until this crop is finished. There is the chance of rain in parts of the region around midweek with broader coverage possible this weekend. Cold weather in Brazil could cause some damage to their second crop. The harvest of that crop is just getting started at 1% complete, compared to 3% a year ago. CONAB’s next update for Brazil is scheduled for the 13th. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday. Ethanol demand remains one of the relative bright spots for corn.
The wheat complex was mixed, with Chicago up and Kansas City and Minneapolis down. 64% of spring wheat is in good to excellent shape, the best first rating in years, with planting nearly complete. It remains to be seen how many acres have actually been planted to spring wheat following the early delays in the northern Plains. The USDA’s 2023 planted area totals are out on the 30th, along with quarterly grain stocks. The winter wheat rating was up on the week with harvest activity getting underway in some areas. None of the complex held onto the strong overnight gains connected to a dam failure in Ukraine, but most months were still able to close above the session’s lows. Data from the Black Sea region says grain volume for Ukraine leaving approved ports was up on the week despite slower inspections by Russia. Moscow is again making overtures about leaving the Black Sea Grain Initiative, which was extended in May. SovEcon projects Russia’s 2023/24 wheat exports at 45.7 million tons, compared to the prior guess of 43 million tons. Australia’s government sees this year’s winter wheat crop at 26.2 million tons, 34% lower than last year due to the anticipated El Nino pattern. China has reportedly allocated money to aid wheat harvest activity in Henan province following recent heavy, damaging rainfall.