Market News

Corn, wheat up on light commercial support

 

Soybeans were steady to fractionally higher on late spillover from bean meal and corn. The trade expects a very large, if not record, crop from Brazil, cancelling out some of the losses in Argentina. Rabobank’s new estimate for Argentina is 40 million tons, compared to the prior projection of 46 million. Potential trade retaliation by China is in the background, with the White House officially announcing tariffs earlier today. Soybean meal was higher and bean oil was lower, adjusting product spreads. The USDA’s weekly export sales report is delayed until Friday by the winter storm on the East Coast.

Corn was modestly higher on short covering and technical buying. Corn is also watching South America, with more potential losses in Argentina and generally good second crop corn conditions for Brazil. Rabobank has Argentina’s corn crop at 33 million tons, compared to the previous estimate of 36 million. Corn is also watching planting conditions in the U.S. with the USDA’s prospective planting and quarterly stocks numbers out next week. Ethanol futures were higher. The USDA’s attaché in Mexico estimates 2018/19 corn production at 26.6 million tons, compared to 26.8 million in 2017/18.

The wheat complex was higher on commercial and technical buying. Forecasts have more mostly dry weather in the southern Plains and precipitation for the eastern Midwest. The bearish fundamentals will continue to limit gains, with new USDA supply and demand numbers out April 10th. The USDA’s attaché in Mexico says 2018/19 wheat production could be as low as 3.27 million tons, following switches to corn and other crops. Consumption is expected to increase, with imports as high as 5.5 million tons. The attaché in India says wheat production in 2018/19 is seen at 94 million tons, compared to the 2017/18 record of 98.5 million tons, with a reduction in planted area. Japan bought 91,942 tons of U.S. food wheat, along with 35,396 tons from Canada. DTN says South Korea bought an unknown amount of feed wheat, probably from the Black Sea region. Russia’s Hydrometcentre says 3% to 5% of Russia’s wheat crop is in poor condition.