Market News
Corn up ahead of the weekly USDA crop numbers
Soybeans were modestly lower on profit taking and technical selling. No new export sales were announced Monday, but China and unknown destinations bought a lot of U.S. beans last week. General trade sentiment is that China bought at least some of those unknown beans but given how much of the sales volume was new crop, that won’t really be known for a few months, with 2020/21 getting underway September 1st. For now, U.S. beans continue to have a price advantage over Brazil, but Beijing did buy a lot in May, 9.38 million tons, including soybeans from Brazil, possibly as a hedge against political tensions with the U.S. Weekly export inspections for U.S. beans were bearish. The USDA was expected to report good planting progress in the weekly update. As of Sunday, 86% of U.S. beans are planted, compared to the five-year average of 79%, and 67% has emerged, compared to 61% on average, with 72% of the crop rated good to excellent, up 2% on the week. Soybean meal and oil followed beans lower.
Corn was modestly higher on short covering and technical buying. Corn planting was expected to be very nearly complete with the USDA’s planted area totals out on the 30th. The USDA says 97% of U.S. corn is planted, compared to 94% on average, with 89% emerged, compared to 84% typically this time of year, and 75% of the crop is called good to excellent, 1% more than a week ago. Parts of the Midwest will see heavy rainfall as Tropical Depression Cristobal moves inland, with flooding expected to be the biggest risk. Supply and demand estimates are out on the 11th and quarterly stocks numbers are also out at the end of the month. This month’s Quarterly Hogs and Pigs report should offer some important clues about feed use. A few days into the final quarter of the 2019/20 marketing year, corn export inspections were bearish. Ethanol futures were higher. AgRural lowered its’ estimate for Brazil’s corn crop to 96.4 million tons, which supported that nation’s soybean prices. The trade is also watching shipping out of Brazil for any delays related to the spread of COVID-19.
The wheat complex was mostly lower, with Chicago and Kansas City down and Minneapolis is up. The winter wheat harvest is ongoing with mixed early anecdotal yield numbers, while spring wheat planting is expected to see better planting weather after some near-term delays. For winter wheat, 85% has emerged, compared to 88% on average, and 7% is harvested, matching the normal pace, with 51% rated good to excellent, 1% less than last week. For spring wheat, 97% is planted and 81% has emerged, both behind normal, with 82% called good to excellent, up 2%. The trade is also watching global weather, including dry conditions in the Black Sea region, with the Russian state of Stavropol expected to see as much as a 40 drop in grain production, while parts of the European Union have recently received beneficial precipitation. France’s AgriMer says 56% of the nation’s soft wheat crop in in good to excellent condition, steady on the week, but holding at a nine-year low. The trade is also keeping an eye on dry weather in parts of Argentina. Weekly export inspections were down on the week and the year and while it is early in 2020/21, the pace trails 2019/20.
