Market News

Corn up on slow planting pace

 

Soybeans were mixed, mostly firm on old crop/new crop spread adjustments. Argentina bought 130,000 tons of U.S. beans, 60,000 tons for this marketing year and 70,000 for next marketing year, likely for crush purposes and possibly to resell. Argentina is usually the world’s biggest exporter of soybean products, but production was slashed this year by drought or near drought conditions. Beans remain nervous about China’s proposed 25% import tariff, which is keeping export demand for U.S. beans slow, even as Brazil’s supply tightens and their prices move higher. China will likely have to buy U.S. beans at some point, but it may take a while. Soybean meal was mixed, adjusting old crop/new crop spreads, and bean oil was weak. According to Allendale, Cargill has idled two soybean processing facilities in Argentina, citing safety concerns because of worker strikes, while unions claim the company doesn’t want to pay workers during strike activities.

Corn was modestly higher on commercial and technical buying. As of Sunday, 5% of the U.S. corn crop is planted, compared to 15% a year ago and the five-year average of 14%. Forecasts generally have warmer weather in many key growing areas, which should allow a lot of the region to make good progress ahead of next week’s USDA crop progress and condition update. Domestic demand is good with record or near record livestock herds and solid ethanol demand prospects, but there’s plenty of corn available and while shipments have picked up steam, the export market is no better than neutral. New supply and demand numbers are out May 10th. The trade also has an eye on dry conditions in Brazil possibly stressing second crop corn. Ethanol futures were lower. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday.

The wheat complex was higher on commercial and technical buying, taking the lead in grains and oilseeds. The USDA’s winter wheat condition rating held steady despite more mostly dry weather in the southern Plains. Soft red winter conditions continue to generally look better than hard red winter. Still, it will be hard for the complex to gain a lot of traction, with mostly good global growing and development conditions. Spring planting remains much slower than average at only 3% complete, with more near-term delays expected in parts of the northern U.S. Plains and Canada. Most of the spring wheat planting progress has been in the Pacific Northwest. Statistics Canada’s next set of acreage numbers, including spring wheat, is out Friday. Jordan is tendering for 100,000 tons of optional origin milling wheat and Bangladesh is in the market for 50,000 tons of milling wheat.