Market News

Another down day for soybeans, corn

Soybeans were lower on fund and technical selling, with the May contract closing at a five-month low. The trade continues to wait for the next official step in negotiations with China. Reports of a timeline for the next round of talks are sketchy. There’s even more export competition is on the horizon, with Argentina and Brazil expected to produce large crops, with harvest ongoing in Argentina and nearly complete for Brazil. Soybean meal and oil were lower on the fundamental implications of big South American crops and the uncertainties about China. The USDA’s attaché in the Philippines expects 2018/19 soybean meal imports to be 2.95 million tons, rising to 3.15 million in 2019/20, most of that from the U.S. Markets and most USDA offices will be closed Friday for Good Friday.

Corn was fractionally lower on fund and technical selling. Corn is also waiting for news on China and watching conditions in South America. Both Argentina and Brazil are expected to harvest big crops this year, leading to even more export competition. In addition to China, corn is also waiting to see what happens with Japan and the USMCA. U.S. planting progress is generally expected to be mixed over the next couple of weeks, with the next set of weekly numbers out on the 22^nd. Ethanol futures were higher. The U.S. Energy Information Administration says ethanol production was up 15,000 barrels on the week for an average of 1.016 million a day, while stocks were down 517,000 at 22.676 million, the first time below 23 million this year. There’s been more talk of new export demand, but everything’s either been below the USDA’s reporting threshold or optional origin.

The wheat complex was mixed, mostly modestly higher. Kansas City bounced off Tuesday’s new contract low, but the fundamental outlook remains bearish, with about a month and a half remaining in the marketing year for wheat. Chicago and Minneapolis were mostly firm, consolidating. The winter wheat pits continue to monitor crop development conditions, while Minneapolis is watching the spring planting paces in the U.S. and Canada. If there’s a bright side to the recent losses, it’s the potential for new export demand, but that might be offset by relatively high freight costs. The USDA’s next weekly export sale report is out Thursday morning. According to Allendale, Germany’s wheat crop is expected to be up more than 20% on the year at 24.44 million tons. Jordan is tendering for 120,000 tons of milling wheat and the Philippines is in the market for 220,000 tons of feed wheat.