Wheat resumes lower trend
Soybeans were mixed, mostly firm, consolidating. Beans are watching U.S. planting, with more rain in the forecast for some areas, further pushing back activity. Crush margins have narrowed due to tight near-term supplies but remain in positive territory. Soybean meal was higher and bean oil was lower on adjustment product spreads. That weakness in bean oil is despite the continued tight global supply of vegetable oils because of a lack of sunflower oil exports from Ukraine and uncertainties about palm oil sales by Indonesia and Malaysia. Argentina’s ag ministry says the April soybean crush was 3.93 million tons, up 1 million from March. Chinese owned firm COFCO says it will phase out purchases of crops, including soybeans, grown in deforested areas of South America by 2030. India’s government has resumed imports of GME soybean meal, allowing the remaining 550,000 tons of a 1.2-million-ton quota to be filled.
Corn was lower on fund and technical selling, along with spillover from wheat. Planting is 72% complete, above most expectations ahead of the weekly numbers, and while emergence is slow, warmer weather will help. Corn is also monitoring the impact of drought on second crop corn in central Brazil. Parts of southern Brazil are in generally better condition. The U.S. Energy Information Administration’s weekly ethanol production and supply numbers are out Wednesday. Ethanol and export demand continue to be solid, but an export deal between China and Brazil could have an impact on those sales. The sellers would have to be cleared by China, but the agreement would allow Brazil to ship corn to China. China has recently turned to U.S. corn in the absence of Ukraine from the market following the invasion by Russia. APK-Inform estimates Ukraine’s corn crop at 25.2 million tons, compared to the prior projection of 18.5 million, with exports of 25.7 million tons, compared to 21.2 million last marketing year.
The wheat complex was sharply lower on fund and technical selling. The USDA’s winter wheat condition rating improved a little, up 1%, but remains near historically low levels for this time of year at 28% good to excellent. The big question for winter wheat producers in the central and southern U.S. Plains is how many acres will be effectively abandoned due to drought damage. Heavy rain could hit parts of the central and southern Plains this week, too little too late to help and possibly leading to flooding. Conditions for the soft red winter crop remain comparatively better, but parts of the eastern Midwest do have excessive soil moisture. About half of the U.S. spring wheat crop is planted, with mixed near-term forecasts for that growing region. Frost advisories have been issued for portions of the Canadian Prairies. The trade continues to monitor weather in Europe and India, along with planting activity in Argentina, Australia, and Ukraine. APK-Inform sees Ukraine’s wheat crop at 17.1 million tons, compared to the earlier guess of 16.96 million, with exports of 12.3 million tons, compared to 18.8 million in the previous marketing year. Russia’s Federal State Statistics Service says grain stocks on May 1st were 13.3 million tons, up 7% on the year.