Market News

Soybeans supported by South American yield concerns

 

Soybeans were modestly higher on commercial and technical buying, along with a late bounce in nearby bean meal. Forecasts have more scattered rainfall in Argentina, missing some of the drier areas, probably lowering the final yield. Conditions in Brazil generally look good, with early harvest activity underway in some areas. Rain delays have been reported and some while anecdotal yields have been good, more rain would trim potential. Soybean oil was higher on commercial buying and bean oil was mixed, adjusting old crop/new crop spreads, breaking a string of fully higher finishes for bean meal. Argentina is the world’s biggest exporter of that soybean product. According to wire reports, Informa Economics now projects 2018 U.S. soybean acreage at 91.197 million acres, less than their last guess, but still an all-time high. The USDA’s prospective planting report is due at the end of March.

Corn was modestly lower on profit taking and technical selling. Unknown bought 256,096 tons of 2017/18 U.S. corn Tuesday morning, but export demand has been slow all marketing year because of increased competition and there’s a lot of corn available. Corn’s also watching conditions in South America, with the current La Nina pattern expected to remain until the end of summer in the southern hemisphere. Argentina is the world’s third biggest export of corn. Ethanol futures were mostly firm. The weekly EIA production and stocks data is still due out Wednesday. The USDA’s weekly export sales report will be delayed until Friday by the recent government closure. Corn’s also monitoring NAFTA negotiations, which resumed this week in Montreal. Ahead of the USDA’s prospective planting report at the end of March, Informa Economics new projection for 2018 corn acreage is 89.179 million, less than the firm’s prior estimate and down from the 2017 total.

The wheat complex was modestly lower on profit taking and technical selling. Drought conditions persist in parts of the Plains, but damage won’t be known until the crop emerges from dormancy. The global supply will continue to limit any real upside, even if there is buying interest at these price levels. New supply and demand numbers are out February 8th, the last day of the current federal government funding measure. Japan is tendering for 84,577 tons of food wheat from the U.S. and Australia. Informa Economics, via wire reports, estimates 2018 U.S. spring wheat acreage at 11.255 million acres, with durum acreage of 2.254 million.