Market News
Down day for soybeans, corn, wheat
Soybeans were lower on fund and technical selling. Export sales to China are considerably above a year ago, but still not meeting Phase One agreement levels. Given the expected record production and price advantage held by Brazil, U.S. soybean sales to China might not really pick up steam until this summer. According to customs data from China, soybean imports during March were the lowest for in several years at 4.28 million tons because of shipping delays from Brazil and the spread of coronavirus. Overall, first quarter ag imports from the U.S. by China were reportedly $5.05 billion, up sharply from Q1 2019. The trade is watching harvest conditions in South America and U.S. weather ahead of widespread planting. The USDA’s first soybean planting pace estimate of the season is expected to be out next week. Soybean meal and oil followed beans lower, including a new contract low for May meal. The National Oilseed Processors Association’s member crush numbers for March are out Wednesday. Ahead of the report, analysts see the crush at 175.163 million bushels, which would be a new monthly record.
Corn was lower on fund and technical selling, along with spillover from a drop in crude oil. Demand for ethanol use is slow and the slowdown in the livestock industry could lead to lower feed demand. Export demand has picked up steam, but corn has seen a lot of competition from Argentina, Brazil, and Ukraine. 3% of the U.S. corn crop is planted, steady with a year ago and a little bit behind the five-year average of 4%. Planting delays are possible in some areas but while forecasts are mostly on the cool side of things, they have generally been a little drier. Ethanol futures were mostly lower. The U.S. Energy Information Administration’s weekly ethanol production and supply numbers are out Wednesday. Crude oil started selling off late Monday and continued Tuesday after a lower than expected cut in production by several nations and OPEC.
The wheat complex was lower on fund and technical selling, with Kansas City leading the way down after leading the way up Monday. 62% of winter wheat is rated good to excellent, steady with last week and up 2% on the year, and spring wheat planting is underway at 5%. For winter wheat, there are concerns about damage from a recent freeze, but given the short duration in most areas, damage is expected to be minimal and might not be quantified for some time anyway. Most forecasts have improved weather for parts of the Black Sea region, especially what had been dry areas in central and southern Russia. DTN says Egypt bought 120,000 tons of wheat from Russia.
