Soybeans down on concerns about demand from China
Soybeans were lower on fund and technical selling. China was the biggest buyer of U.S. soybeans last week, both old and new crop, but hasn’t made any significant purchases since last week. Both Beijing and Washington D.C. say Phase One requirements will be met, but that’s in doubt because of issues surrounding COVID-19. Beans are also watching weather in South America and planting conditions in the U.S. There continue to be a lot of questions about just where domestic acreage will end up, with the USDA’s 2020 planted area totals out June 30th, along with the quarterly grain stocks numbers. Soybean meal was lower with July hitting a multi-year low on feed demand uncertainties, while bean oil was down on the bearish tone in the soy complex.
Corn was modestly lower on fund and technical selling. The weekly corn export numbers were solid, but while demand for ethanol use is improving, it’s still well below a year ago. Demand for feed use is also a concern, with the USDA expected to report a second straight month of much lower than a year ago placements into feedlots Friday. Most forecasts have a mixed near-term pattern for U.S. planting weather, with some expectations planting will essentially be wrapped up by the end of May. The USDA’s weekly crop progress and condition numbers will be out on the 26th, with the USDA and markets closed Monday for Memorial Day. Corn is also keeping an eye on dry conditions for big chunks of Brazil’s second crop. China will auction off 4 million tons of corn from state reserves on May 28th. Ethanol futures were mostly lower. China is reportedly set to receive a shipment of U.S. ethanol resold by a previous purchaser.
The wheat complex was mixed, mostly modestly higher. The trade is watching weather dry concerns in parts of the U.S. and Europe, supporting Chicago and Kansas City. Parts of the Black Sea region, including dry portions of southern Russia and Ukraine are expected to see some near-term rainfall. The trade was waiting for the results of a major crop tour in the southern U.S. Plains, with yields from the first couple of days reflecting weather issues and generally coming in below USDA projections. Minneapolis was down on profit taking, watching spring wheat planting weather in the northern U.S. Plains and Canada. Weekly export numbers were good with the current marketing year wrapping up at the end of the month. Old crop sales weren’t great, but new crop was good and the old crop shipments were more than what’s needed to meet projections for 2019/20.