Market News
Downward drift continues for corn, soybeans, wheat
Soybeans were lower on fund and technical selling, posting losses for the third consecutive session. The trade is waiting for what’s next with China, but African Swine Fever is impacting Chinese demand for beans, with a private firm from China projecting decreases in imports through at least June. Face to face negotiations are scheduled to resume next week. Harvest is close to wrapping up in Brazil and advancing at a strong clip in Argentina. DTN says FOB U.S. beans at the Gulf are at a $2 premium to Brazilian supplies and command a $21 premium to beans from Argentina. According to AgriCensus, sales of Brazil’s new crop beans to Mexico are up 150% on the year. Soybean meal and oil followed beans lower. Statistics Canada estimates soybean planted area at 5.646 million acres, down 10.7% on the year because of drier conditions in western Canada. Canola acreage is pegged at 21.314 million acres, 6.6% lower than last year because of the current trade dispute between Canada and China.
Corn was lower on fund and technical selling. The July contract made another new low with corn also waiting for China and watching conditions in South America. According to DTN, corn from Argentina is currently $.60 cheaper than U.S. corn. China doesn’t import a lot of corn currently, but is expected to increase purchases, which could benefit the U.S., depending on what happens with negotiations. Ukraine has recently taken a larger role in global corn trade, with exports now topping 23 million tons. The trade is also watching the U.S. corn planting pace, expecting mixed progress over the next couple of weeks. The USDA’s next set of planting estimates is out on Monday the 29th. Ethanol futures were sharply lower. The U.S. Energy Information Administration says ethanol production last week averaged 1.048 million barrels a day, up 31,000 on the week, with stocks of 22.747 million barrels, 71,000 higher. The USDA’s NASS says it will not resurvey for stored grain losses in the Midwest caused by flooding, but June grain stocks will factor in those losses. Statistics Canada projects 2019 corn planted area at 3.795 million acres, up 4.6% from 2018.
The wheat complex was lower on fund and technical selling, with July Kansas City establishing another new contract low and July Chicago closing near it’s low. The U.S. winter crop is in very good shape overall and while U.S. spring wheat planting is slow, weather is expected to improve, at least some extent. Statistics Canada is projecting a big increase in spring wheat acreage. Planted area is pegged at 19.387 million acres, a year to year jump of 12.0%, with durum at 5.021 million acres, down 18.8%, and winter wheat at 1.265 million acres, 2.2% higher. Total wheat acreage for Canada is estimated at 25.674 million, 3.8% above a year ago. The European Commission pegs 2018/19 E.U. soft wheat exports at 16.5 million tons as of April 21st, down 2% on the year. SovEcon lowered its outlook for Russia’s wheat exports to 35.1 million tons. DTN says Tunisia is tendering for 92,000 tons of milling wheat. The USDA’s weekly export sale report is out Thursday at 8:30 Eastern/7:30 Central.
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