Market News

Slow exports pressure soybeans, corn

 

Soybeans were lower on profit taking and technical selling. Weekly export numbers were neutral to bearish and Chinese demand remains a big question mark. Brazil is currently filling most of Beijing’s soybean needs, but their prices have shot higher as Argentina’s production projections have moved lower. Eventually, China will have to return to U.S. beans in earnest, but that may take some time. The trade’s also watching early corn planting delays. The key word is “early”, but if delays persist, it could mean bigger U.S. bean acreage this year. Soybean meal was lower, following beans, and oil was mixed, consolidating.

Corn was lower on commercial and technical selling. Forecasts have more planting delays in some key growing areas, but parts of the region should see an improvement in conditions by this weekend. It is still relatively early, but the delays will be a bigger issue if they last into May. Weekly export numbers on corn were neutral to bearish. Ethanol futures were mostly firm. Corn’s also watching development conditions for Brazil’s second crop. Brazil’s FOB prices are currently below U.S. prices at the Gulf. New USDA supply and demand estimates, including the first 2018/19 projections, are out May 10th. According to wire reports, Chinese corn demand could hit 225 million tons this year.

The wheat complex was mixed, mostly modestly higher. Kansas City and Chicago were up on continued concerns about the condition of the U.S. winter crop, expecting another lower rating on Monday as recent precipitation wasn’t even close to a drought breaker. Minneapolis was down on profit taking, despite continued planting delays in the northern U.S. Plains and Canada. With less than a month and a half to go, weekly export sales were a new marketing year low. Japan bought 68,786 tons of U.S. milling wheat, along with 33,116 tons from Canada. Iraq purchased 100,000 tons of milling wheat from Australia, while Jordan picked up 50,000 tons of optional origin milling wheat. The USDA’s attaché in Canada says 2018/19 wheat production should be close to 2017/18, thanks to increased spring wheat acreage and better durum yields cancelling out generally lower spring wheat yields.