Market News

Weather concerns push corn, soybeans, wheat higher

Soybeans were sharply higher on commercial and technical buying, pulling March and May back above $14. Weather concerns were back in the driver’s seat, with harvest delays in Brazil and dry weather in the forecast for most of Argentina. There’s been more talk of China buying beans from Brazil, even with that slow harvest. The USDA hasn’t announced a sale of U.S. soybeans since January 29^th. Even if demand has slowed down, the fundamental outlook continues to be bullish because of the supply, with the USDA’s next set of projections out on the 9^th at Noon Eastern/11 Central. Supply projections are also bullish into next marketing year. The trade is also watching U.S. conditions ahead of widespread planting, with acreage expected to be up on the year because of demand and higher crop insurance guarantees. Soybean meal and oil were supported by commercial demand.

Corn was higher on commercial and technical buying. Corn is also watching weather in South America, with soybean harvest delays in Brazil delaying second crop corn planting. That crop is the largest of the three and the source of most of Brazil’s exports. Japan bought 175,000 tons of new crop U.S. corn – the first USDA announced sale of any commodity since February 12^th. Stateside, the trade is watching probable planting delays in parts of the south and the Delta. The USDA says 3% of Texas’ corn crop is planted, compared to 7% on average. The USDA’s prospective planting numbers are out March 31^st, along with quarterly grain stocks. DTN says Taiwan bought 65,000 tons of optional origin corn, which could end up coming from Argentina. Ethanol futures were higher. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday.

The wheat complex was higher on fund and technical buying. Paris milling wheat was mostly higher ahead of the U.S. session and U.S. winter wheat condition ratings were lower on the week. Drought continues to be the big issue in parts of the U.S. Plains. Any recent winterkill damage in the U.S. Plains or Midwest, or for that matter Russia or Ukraine, won’t be fully quantifiable until crops emerge from dormancy. The USDA says 37% of Kansas’ crop is rated good to excellent, down 3% on the week, with 42% of topsoil short to very short of moisture, while 28% of Texas’ crop is called good to excellent and Oklahoma has a rating of 46% good to excellent, both 2% lower. SovEcon estimates Russia’s 2020/21 wheat exports at 39.1 million tons, up 1.2 million from the last guess as sellers rushed to get grain out ahead of higher export tariffs. Moscow’s 25 Euro per ton tariff doubled this past Monday. The European Commission says European Union soft wheat exports from July 1^st, 2020 to February 28^th, 2021 were 17.56 million tons, compared to 21.48 million last marketing year. DTN says Japan is tendering for 82,937 tons of food wheat from the U.S. and Canada, while Pakistan is in the market for 300,000 tons of wheat.