Market News

Wheat up, watching weather, export market

Soybeans were modestly lower on profit taking and technical selling. The trade’s waiting for fresh news from this round of negotiations with China. The deadline for talks is March 1st and it’s unclear whether that will be extended. President Xi is expected to join negotiations later this week and is expected to meet with President Trump in March. Beans are also monitoring development and harvest weather in South America. Private and government agencies have reduced outlooks for Brazil, but Argentina’s crop should be up sharply on the year. Soybean meal was higher and bean oil was lower on the adjustment of product spreads. The National Oilseed Processors Association’s monthly member crush report for January is out Friday, with an average guess of 169.575 million bushels.

Corn was steady to fractionally higher. Corn is also watching the trade talks with China, the export market, and crop critical weather in parts of Argentina and Brazil, especially the planting pace for Brazil’s second crop. State side – there are early concerns about planting delays. The USDA’s prospective planting numbers are scheduled for the end of March but could be delayed if the government can’t avoid another extended shutdown. President Trump has said he doesn’t want another shutdown but will be looking for “landmines” in the bill. Weather is also complicating interior movement and shipping out of some ports. Ethanol futures were higher. The U.S. Energy Information Administration says production last week averaged 1.029 million barrels per day, up 62,000 on the week, with supplies of 23.466 million barrels, down 481,000. The industry continues to monitor margins, while waiting for more details on year-round E15 use and any potential policy changes at the EPA.

The wheat complex was modestly higher on short covering and technical buying. Forecasts have the potential for stress or winterkill in winter wheat growing areas in the Midwest and Plains. There’s more talk of new export demand, but nothing has surfaced yet. Japan is tendering for 113,138 tons of food wheat from the U.S., Canada, and/or Australia and Bangladesh is in the market for 50,000 tons of milling wheat. In sell-buy-sell trade, Japan bought 9,576 tons of U.S. feed wheat. According to reports, Egypt will allow wheat imports from Serbia. The biggest global buyer of wheat usually relies on Black Sea origin supplies, especially from Russia, but prices have climbed as stocks shrink and are now more expensive than many other origins, including the U.S.