Corn, wheat manage modestly higher finishes

Market News

Corn, wheat manage modestly higher finishes

Soybeans were mostly lower, watching weather in South America. Parts of Argentina and southern Brazil got showers over the weekend, with a mixed forecast for this week, generally favoring Argentina. Damage has been done, but rain could stabilize yields in some areas. AgRural reports Brazil’s harvest is 24% complete, faster than average despite delays due to rain in some central and northern areas. Soybean export inspections were down on the week, up on the year, and primarily to China and Italy. The 2021/22 pace is behind 2020/21. Officials in China are renewing calls for producers to increase soybean planted area this spring planting season. Soybean meal was lower on that rain in the forecast for Argentina, while bean oil was up on the strength in crude oil, which was supported by concerns over energy availability if Russia invades Ukraine. Additionally, Malaysian palm oil futures hit record highs ahead of the regular U.S. session. Tuesday’s NOPA member crush report for January is expected to show a record large monthly crush.

Corn was modestly higher on short covering and technical buying, rebounding from early losses. Corn is also watching conditions in South America, including weather for the planting of Brazil’s critical second crop. AgRural says 42% of that crop is planted in center-south Brazil, well ahead of average. That second crop is the largest of the three and the source of most of Brazil’s corn exports. There’s been more talk, but no confirmation, of China buying U.S. corn. U.S. export inspections were nearly 1.5 million tons, mainly to China and Mexico, with the 2021/22 pace continuing to trail 2020/21. Stateside, the trade is watching signals on potential U.S. acreage shifts this year, with some analysts expecting a three-million-acre reduction in planted area. The USDA’s prospective planting numbers are out at the end of March. Ethanol futures were unchanged.

The wheat complex was modestly higher on short covering and technical buying, uncovering new buying interest late in the day. There’s been no resolution to the tensions in the Black Sea region, but Russia says it is willing to engage in more talks with the West. Still, tensions are ongoing, with the threat of conflict a possibility, and the U.S. has temporarily moved embassy operations for Ukraine from Kyiv to Lviv. Russia’s wheat export tax moved lower last week due to weakness in the ruble. There are chances for precipitation in parts of the U.S. Plains this week, but large portions of the region will stay in drought or near drought conditions. That’s impacting winter wheat conditions and could limit spring wheat planted area in parts of the U.S. Plains and Canada. U.S. export inspections were up slightly on the week and the year, with Mexico and Taiwan topping the list. Well into the third quarter of the marketing year, inspections remain behind the year ago pace.