Market News

Wheat leads on talk of more crop loss in Europe

Soybeans were modestly higher on commercial and technical buying. Contracts were up and down for most of the session, with spillover support from corn and wheat against pressure from generally good crop conditions in most key U.S. growing areas and China’s tariff on U.S. beans. The actual impact of the White House’s Trade Aid package is an unknown. A lot of the details of the package have not been made available and any disbursement of funds would still be weeks away. Several lawmakers, commodity groups, farm policy groups, and farmers have also expressed a preference for resolution to the current trade disputes over government assistance. Soybean meal and oil were higher, following beans. Talk of a possible deal between the U.S. and European Union including soybeans following a meeting between President Trump and the E.U.’s Jean-Claude Juncker was reported Wednesday afternoon.

Corn was higher on commercial and technical buying, along with spillover from wheat. Domestic demand continues to be the big source of support for corn, with weekly average ethanol production hitting a new high for the year. The U.S. Energy Information Administration says the weekly average was 1.074 million barrels, up 10,000 on the week, and stocks were pegged at 21.653 million barrels, down 115,000. The USDA also expects solid feed use. Trade talks with the European Union occurred Wednesday and discussions with Mexico are scheduled for later this week. The trade also continues to monitor U.S. crop weather. Ethanol futures were higher. According to Allendale, Argentina is expected to increase corn acreage next year. Continued crop weather issues for feed wheat in Europe would probably lead to at least some increase in corn demand.

The wheat complex was sharply higher on commercial and technical buying. European milling wheat futures were up sharply overnight, sparking the U.S. rally. Strategie Grains lowered its European Union soft wheat milling production estimate to a multi-year low because of crop weather issues in northern and central portions of Europe. The trade is also monitoring conditions in the U.S. Pacific Northwest, the Canadian Prairies, the Black Sea region, and Australia. The results from a spring wheat crop tour in the northern U.S. Plains are out Thursday. AgriCensus says Egypt bought 420,000 of milling wheat from Romania, Russia, and Ukraine. DTN reports Japan purchased 3,500 tons of feed wheat in sell-buy-sell trade.