Market News

Soybeans wilt late on acreage figure, demand concerns

Soybeans were modestly lower on profit taking and technical selling, unable to follow through on the initial post report gains. The USDA says U.S. soybean acreage was down 1% on the year, but up from March and topping corn for only the second time on record, at least for now, while quarterly stocks were 26% higher. A few U.S. acres have yet to be planted and recent flooding may lead to some replanting. The USDA’s next set of supply, demand, and production numbers is out July 12th. Mexico 130,632 tons of new crop U.S. beans. According to wire reports, the last shipment of U.S. soybeans ahead of China’s tariffs taking effect is on its way to Dalian, expected to arrive July 5th. Beijing’s 25% tariff on U.S. soybean imports is officially in place July 6th. Soybean meal was mixed, adjusting old crop/new crop spreads and bean oil was up on commercial buying. Statistics Canada estimates 2018 soybean acreage at 6.320 million, down 13.2% from 2017, while planted area for canola was 22.740 million acres, 1.1% less than last year.

Corn was modestly higher on commercial and technical buying, settling in the middle of the day’s trading range. According to the USDA, 2018 corn acres were also down 1% from a year ago, along with a 1% increase in quarterly stocks. Parts of the Midwest were expected to see a hot, dry weekend, potentially causing some stress during these early stages of development. Also, that acreage figure is as of June 1st and could change because of recent flooding in parts of the region, either through switching to beans or outright abandonment. Corn continues to monitor any developments, or lack thereof, in trade talks. Ethanol futures were higher. According to Stats Canada, that nation’s corn planted area was 3.634 million acres, up 1.6% on the year.

The wheat complex was mostly sharply higher, with Chicago and Kansas City up on commercial and technical buying. Total wheat acreage is up 4% from last year, but still the second lowest in about a century, with a 20% jump for spring wheat. Minneapolis ended the day mostly weak on that spring wheat acreage figure and the gains in the winter wheat pits may be short lived because of the continued bearish fundamental outlook. Quarterly wheat stocks, effectively 2017/18 ending stocks, were down 7% at 1.1 billion bushels. Jordan is tendering for 120,000 tons of milling wheat and the Commodity Credit Corporation bought 111,100 tons of soft white winter for Yemen. Statistics Canada says planted area for all types of wheat was 24.71 million acres, a year to year increase of 10.4%, with spring wheat at 17.296 million, 9.5% higher, durum at 6.185 million acres, a jump of 18.8%, and winter wheat at 1.228 million, a decline of 11.3% from 2017.