Market News

Wheat up, corn firm, soybeans mixed

Soybeans were mixed on spread trade, with nearby months down and deferred contracts up. The trade continues to monitor shipping out of South America and signs of new demand from China. Customs data from China says Beijing bought 6.101 million tons of U.S. beans in January and February, compared to the 5.14 million tons purchased from Brazil and up sharply from the year ago total of 1.044 million tons. Soybean meal was mixed on spread adjustments, following the lead of beans, despite reports of tight supplies at crush plants in Argentina because of efforts to stop the spread of coronavirus. Soybean oil was up on the higher move in crude oil and the sale of 20,000 tons of 2019/20 U.S. bean oil to South Korea. The USDA’s attaché in Indonesia estimates 2020/21 palm oil production at 43.5 million tons, with an increase in planted area partly canceled out by lower yields. 2019/20 palm oil exports were lowered on slower domestic and export demand.

Corn was modestly higher on commercial and technical buying. Contracts continued their bounce off of last week’s lows, waiting for Congress to vote on the coronavirus aid package. No vote during the session, but the broader market was encouraged by the progress that had been made on the deal, leading the Dow Jones Industrial Average to back to back gains for the first time since early February. The trade is also monitoring U.S. conditions ahead of widespread planting, with the USDA’s Prospective Planting and Quarterly Stocks numbers out on the 31^st. The U.S. Energy Information Administration says ethanol production last week had the lowest average since October at 1.005 million barrels a day, a decrease of 30,000 on the week, while stocks were down 458,000 barrels at 24.140 million. Ethanol futures were higher. There’s also talk of improved demand for U.S. DDGS from China. Unknown destinations bought 138,000 tons of 2019/20 U.S. corn Wednesday morning.

The wheat complex was higher on commercial and technical buying, with Chicago and Kansas City in the lead. Domestic and export demand are good as flour millers and grocers try to keep store shelves stocked. The dollar index was lower during the session, which helps U.S. goods be more competitive on the export market, but U.S. wheat is already priced above most competing origins. Paris milling wheat futures were lower heading into the U.S. session and Russian wheat prices have also trended lower lately. The USDA’s weekly export sales numbers are out Thursday morning. DTN says Algeria bought 240,000 tons of milling wheat from an unknown origin and Taiwan reportedly purchased 120,000 tons of feed wheat.