Market News

Quiet close for corn, soybeans, and wheat

Soybeans were modestly higher on short covering and technical buying, rallying slightly after a mostly weak start to the day. Contracts saw a bounce off the multi-month lows, but continue to watch harvest progress in South America, expecting large crops out of both Argentina and Brazil. Celeres raised its outlook for Brazil’s crop to 115.8 million tons and Argentina’s government has their crop at 55.9 million tons. The trade is also waiting for the next step in negotiations with China. Reports say a timeline for the resumption of face-to-face talks has been established, but nothing’s publicly official yet. Weekly export numbers were bearish. Soybean meal was weak and bean oil was higher on the adjustment of product spreads. Despite the uncertainties about demand from China, soybean meal exports remain ahead of last marketing year.

Corn was fractionally mixed. Corn was also watching South America ahead of the long holiday weekend and waiting for the next step with China. In addition to China, corn is also waiting to see what happens next with Japan and the USMCA. Argentina’s government has corn production at 55 million tons, while Celeres sees Brazil’s combined corn crop at 97.9 million. U.S. planting progress is expected to be mixed over the next couple of weeks, much better in some areas than others. The USDA’s next set of crop progress and condition numbers is out Monday afternoon. Weekly export numbers for corn were bearish, but physical shipments were above what’s needed to meet the USDA’s figure for the current marketing year. Markets and many USDA offices are closed Friday for Good Friday. Ethanol futures were mixed. In addition to corn, U.S. ethanol, DDGS, and sorghum could play a role in proposed trade deals.

The wheat complex was mostly modestly lower, with Chicago and Minneapolis down and Kansas City steady to weak. Weekly export numbers were bearish with only about a month and a half left in the 2018/19 marketing year and the overall fundamental outlook is bearish ahead of the next set of supply and demand numbers. World conditions generally look good, with bigger production estimates recently from Russia and Germany, so there’s even more export competition on the horizon. U.S. winter wheat conditions look good overall and while spring wheat planting is slow, some of the potential U.S. losses could be offset by a bigger crop out of Canada. DTN says Japan bought 35,050 tons of U.S. food wheat, along with 34,995 tons from Canada and 27,130 tons from Australia. U.S. Wheat Associates were in Brazil this week, trying to secure 80% of Brazil’s tariff free wheat import quota.