Soybeans up, corn, wheat down after USDA numbers
Soybeans were higher on commercial and technical buying, below the highs, but still towards the upper end of the day’s range. The USDA lowered U.S. ending stocks on an increase in the export projection, while world ending stocks were down modestly from January. Aside from slight changes to carryout, there were no adjustments for Argentina or Brazil, limiting gains. Still, unlike either corn or wheat, beans were able to finish the session in the black. The USDA’s soybean production estimates for Argentina and Brazil could be trimmed in coming months because of a drier weather pattern in Argentina and harvest delays in Brazil. A 20-day truck strike in Argentina affecting the Buenos Aires port has reportedly ended. The trade is also monitoring conditions in the U.S. ahead of spring planting, with the USDA’s prospective planting numbers out March 31st, along with quarterly stocks. There have been no new announced export sales to China in a few days even as their domestic prices have shot higher, with questions about demand ahead of the Lunar New Year celebrations, which start Friday. Soybean meal and oil were also supported by commercial buying.
Corn was lower on profit taking and technical selling, erasing the day’s early gains after the supply and demand numbers. The USDA did lower U.S. ending stocks on better export demand, but the cut was smaller than expected. Ahead of the report, the average guess was for a roughly 200-million-bushel decline. On the global side, stocks and production were up, and there were also minimal changes for South American corn ending stocks with no adjustments to production or exports. Those changes for Argentina and Brazil could take place in the March update, because of the dry weather in parts of Argentina and delays for second crop corn planting in Brazil. The USDA did raise corn imports by China 6.5 million tons to 24 million tons, far more than the increase for U.S. exports. This week’s export sales report, out Thursday morning, should be bullish, but will still be down sharply from last week’s all-time high. Corn for ethanol use was unchanged at 4.95 billion bushels. Ethanol futures were steady. The U.S. Energy Information Administration’s weekly ethanol production and supply numbers are out Wednesday.
The wheat complex was lower on profit taking and technical selling. U.S. wheat ending stocks were unchanged and while the world supply was sharply lower, production was higher. Ahead of the report, analysts were expecting modest downward adjustments for both the U.S. and the world carryout projections. The USDA did lower exports for Argentina but raised expectations for the European Union and made no changes to sales projections for Australia, Russia, and Ukraine. Imports by China were up slightly at 10 million tons. The USDA’s next set of supply and demand estimates is out March 9th. The complex is keeping an eye on overwintering conditions in the U.S., European Union, and Black Sea region, conditions ahead of spring planting in the U.S. and Canada, and harvest activity in Australia. The European Commission says that between July 1st, 2020 and February 7th, 2021, European Union soft wheat exports were 15.81 million tons, compared to 18.86 million this time last marketing year. Moscow has reportedly approved the formula-based export tax system that will go into effect June 2nd, just after the start of the new marketing year. DTN says the Philippines bought 224,000 tons of optional origin feed wheat, expected to be sourced from Australia.