Market News

Soybeans, corn, wheat end midweek session mixed

Soybeans were mixed. Beans consolidated after the recent strength, watching harvest activity in Brazil, and getting ready for Friday’s USDA numbers. Quarterly stocks should be tighter, while planted area is expected to be up on the year. The generally dismal condition of Argentina’s crops has been a loss-limiting factor for both soybeans and corn. There’s been talk but no confirmation that U.S. purchases of soybeans from Argentina by crushers have been canceled due to those crop weather issues drastically impacting production. Brazil continues to hold most of the global soybean market due to a price advantage that has been exacerbated by a drop in basis caused by a lack of storage space for this record crop. The spread between Brazilian and U.S. soybean prices is at a near ten-year high. Soybean meal was mixed on bull spreading and bean oil was up on strength in global vegetable oils and demand expectations, some of which are tied to biofuels. The USDA’s attaché in Canada estimates 2023/24 canola production at 18.3 million tons, compared to the office’s 2022/23 figure of 18.174 million tons and the official USDA total of 19 million tons. New crop exports are seen at 8.3 million tons, compared to old crop exports of 8.4 million. Domestic crush is expected to be unchanged.

Corn was mixed on bull spreading. China bought another 204,000 tons of U.S. corn, the 11^th day in the last 12 business days with a new corn sale, 10 of those directly to China. The USDA’s weekly export sales numbers Thursday could show a marketing year high for the second consecutive week. Still, that’s largely because of the slow pace during the first half of the marketing year and there’s always a chance some of these sales could be canceled. New USDA supply and demand estimates are out April 11^th. U.S. corn is expected to have a price advantage into this summer, until the harvest of Brazil’s second crop gets underway. There is the possibility of damage to that critical second crop from drier conditions in some key growing areas starting next month. Quarterly stocks out on Friday are expected to be down slightly from a year ago with an increase in acreage. The U.S. Energy Information Administration says ethanol production last week averaged 1.003 million barrels a day, up 6,000 on the week, but down 33,000 on the year, with stocks of 25.527 million barrels, a drop of 661,000 from the previous week and 1.002 million from this time last year.

The wheat complex was mixed, with Chicago up on technical buying and Kansas City and Minneapolis down on profit taking. Planted area for all types of wheat should be above last year, while quarterly stocks are expected to be down thanks to solid domestic demand offsetting slow exports. Those reports are out Friday at Noon Eastern/11 Central. Early support came from rumors that Cargill will stop exporting grain from Russia but died out on confirmation of the rumors and expectations for that vacuum to be filled by Russian companies. That was in addition to the continued questions about the duration of the current version of the Black Sea Grain Initiative. Russia only wants a 60-day extension and the repeal of sanctions, while Ukraine, Turkey, and the U.N. support the 120-day extension specified under the agreement. Ukraine’s spring planting is expected to be severely limited again this year by Russia’s continued aggression. Hard red winter condition ratings were mixed on the week and spring planting delays are probable in parts of the northern U.S. Plains and Canada, while soft red winter conditions are generally good.