Corn, soybeans, wheat down ahead of holiday weekend
Soybeans were modestly lower on profit taking and technical selling, still posting solid week to week gains. Old crop exports were a marketing year low, but strong new crop demand is supportive, which China buying 126,000 tons of 2020/21 Thursday morning and weekly sales of 30.9 million bushels. Still, Chinese demand remains slow because of political tensions and shipments will need to catch up to meet USDA estimates for 2019/20. Losses were limited by near-term weather concerns for some key U.S. growing areas, potentially robbing the crop of some yield potential, which becomes an even bigger factor because of the lower than expected increase in acreage. Soybean meal was mixed, consolidating, and bean oil was lower on profit taking. Commodity markets are closed Friday for Independence Day, with trade resuming Sunday evening.
Corn was lower on profit taking and technical selling, but with the most active months posting good weekly advances. Corn have back some recent gains, but remains concerned about damage from hot, dry weather. That combined with the largest ever cut in acreage probably mean no record crop this year, but it won’t really do a lot for the actual fundamentals. China bought 202,000 tons of new crop U.S. corn Thursday morning and the weekly numbers look neutral. Shipments were solid, but old crop sales have cooled off after a recent hot streak. In any event, the supply outlook is bearish and there’s competition from Argentina, Brazil, and Ukraine. The USDA’s attaché for Ukraine projects 2020/21 corn exports at 31.6 million tons, up 9% from the recently ended 2019/20 marketing year. 2020 corn production in Ukraine is seen at 38.34 million tons, compared to 35.855 million in 2019. Ethanol futures were higher. The Renewable Fuels Association says May ethanol exports were 67.5 million gallons, a decrease of 32%, and the smallest monthly volume in four years, primarily on a drop in demand from Brazil. India continues to be the biggest market for U.S. ethanol. DDGS exports of 601,029 tons were 21% lower.
The wheat complex was lower on profit taking and technical selling, with weekly gains ranging from firm in Minneapolis to modest in Kansas City to sharply higher in Chicago. The fundamental outlook for wheat remains bearish, with good winter wheat harvest weather and rain in the northern U.S. Plains and Canada. New supply and demand estimates are out on the 10th. Also, any global crop loss is expected to be mostly offset by large crops in other nations. Less than a month into the 2020/21 marketing year, physical shipments of wheat were slightly more than what’s needed to meet USDA projections for the marketing year. The USDA’s attaché for Ukraine estimates 2020/21 wheat export sales at 15.4 million tons, which, if realized, would be down 25% from 2019/20. Production is expected to be 24.703 million tons, compared to 29.144 million in 2019. DTN says buyers from Thailand purchased 100,000 tons of feed wheat out of a 236,000-ton tender and Jordan is tendering for 120,000 tons of milling wheat.