Market News

Wheat futures continue commercial rally

 

Soybeans were modestly higher on short covering and technical buying. The USDA says that Friday morning, unknown destinations canceled on 949,000 tons of U.S. beans, mostly old crop, while buying 168,000 tons, mostly new crop. The trade was also waiting for any news of advancement in trade talks with China. That export activity could be tied to the trade tensions with China. Rumors floated overnight, heading into Friday, that a deal could be close, but after that failed to materialize, contracts drifted. Beans are also watching the U.S. planting pace, with many expecting good week to week progress in many areas. Soybean meal was mostly higher on spread trade and commercial buying, while oil was firm, following beans.

Corn was higher on commercial and technical buying. Near term, many forecasts had more minor planting delays in parts of the Midwest and Plains, but that is recharging soil moisture ahead of key development phases and the onset of summer. In addition to China, corn has been waiting for new news on NAFTA after Congress failed to meet its May 17th deadline for a new deal. Friday, China did announce it was ending its duties and anti-dumping investigation on U.S. sorghum imports. According to wire reports, Chinese demand for U.S. corn has slowed down because of trade uncertainties and concerns about GMOs. Ethanol futures were higher.

The wheat complex was higher on commercial and technical buying, with Chicago and Kansas City posting the strongest gains. Follow through buying was the big factor, along with dry weather in some key global growing areas and recent increase in export demand from Asia. Stateside, dry parts of the Plains could see more precipitation, with the USDA’s weekly crop numbers out Monday afternoon. For now, the fundamentals are bearish with the 2017/18 marketing year ending May 31st. Iraq bought 50,000 tons of wheat each from the U.S. and Australia, while South Korea purchased 63,000 tons of feed wheat from an unspecified origin.