Market News

USDA supply & demand report sparks grain gains

Soybeans were able to gain support following USDA’s World Ag Supply and Demand report that came out ahead of midday on Friday. USDA’s estimated soybean ending stocks fell 25 million bushels from last month to 260 million. The Buenos Aires Grain exchange recently lowered its soybean ratings further, adding support into the market. CONAB, Brazil’s equivalent of the USDA, recently lowered its soybean production estimate to 122.4 million metric tons. Soybean crush margins continue to be strong adding positive signals to traders. The market is watching for more export news to trade on with light export sales confirmed earlier this week. USDA’s Foreign Ag Service noted the sale of 132,000 metric tons of soybean to China Wednesday. The sale of old crop beans is for delivery this marketing year. Crude oil traded moderately higher for most of the day’s session, lending support to soybean oil. May soybeans closed 43 and 1/2 cents higher at $16.89, July beans finished the day up 41 cents at $16.68, May soybean meal closed $8 higher at $468.20 – about $1 below the session high, and soybean oil for May closed 210 points higher at $75.12.

Corn traded higher on the day watching diminishing South American crop ratings. USDA’s corn ending stocks estimate came out at 1.44 billion bushels, unchanged from March with some pre-report estimates expecting a downward adjustment. Even with estimated ending stocks unchanged, dry weather and extreme drought conditions are persisting in southern Brazil and Argentina. Brazil’s corn crop expectations are slightly improving while Argentina’s continue to fall. The market is watching for more news on the export front following a large flash sale to open the week. The Russian – Ukrainian conflict in the Black Sea region continues to be supportive for corn futures. Recent peace talks between the countries have been unproductive and tensions remain high. The Black Sea region is responsible for about 30 percent of global ag exports year to year. Russian fertilizer exports to South America are set to end the first week of May. StoneX says the lack of product moving from Russia to Brazil could hinder crop production further, which would be supportive to the market.  Ukraine’s ag minister recently adjusted his expectation that Ukraine will only produce 20 percent less corn year over year after earlier projections of losing half the crop; some outside estimates are still expecting nearly half the crop to be lost. May corn futures closed 11 cents higher at $7.68 and 3/4, and July corn closed 10 and 1/2 cents higher at $7.60 and 3/4. The market was able to gain residual support with factors generally signaling sideways trade buy closed higher anyway.

Wheat futures are finding support on continued dry weather in the Western Plains states. Continued Russian aggression in the Black Sea region is also propping up the complex. Winter wheat futures generally continue to be supported by Russian attacks on Ukraine. Even so, light amounts wheat product has been able to enter the global market from Ukraine; Russian product is still off the global market, especially with trade sanctions instituted against the exporter. USDA adjusted it’s expected wheat ending stocks to 678 million bushels, 25 million more than a month ago but with lower exports and lower feed use. May Chicago closed 41 and 1/2 cents higher at $10.51 and 1/2, May Kansas City led the nearby complex – gaining 36 cents to finish at $11.06 and 3/4 Friday, and May Minneapolis stays at a premium closing 27 and 3/4 higher at $11.27 and 1/4.