Market News
Soybeans, corn gain as wheat fades again
Soybeans were higher on commercial and technical buying but ended the session below the day’s highs. CONAB lowered its outlook for Brazil’s bean crop by 2.702 million tons, now at 122.77 million, which is under the most recent USDA guess. CONAB left its export projection for Brazil unchanged, for now. Brazil’s National Association of Cereal Exports estimates March soybean exports at 13.769 million tons, compared to the initial projection of 11.775 million, with soybean meal shipments also expected to be up from earlier expectations. The Rosario Grain Exchange sees Argentina’s crop at 40 million tons, 500,000 less than the prior guess. Combined old and new crop weekly U.S. export sales topped 3 million tons, with China and unknown destinations taking the top slot for both marketing years. Soybean sales have picked up steam with those lower production estimates for South America and the tight global supply of vegetable oils. Soybean meal and oil were supported by commercial demand, including a new contract high for May meal. China’s National Grain and Oil Information Center says domestic soybean meal stocks at the start of the week were record low, falling beneath 3 million tons as crush rates continued to slide. China’s government says it will auction 295,596 tons of soybeans from state reserves on Monday, March 14th.
Corn was higher on commercial and technical buying, also finishing under the session highs. CONAB’s corn production estimate for Brazil was just about steady at 112.341 million tons, with a smaller first crop, now at 24.332 million tons, and larger second crop, now at 86.154 million. Both saw an adjustment of just over 100,000 tons from the February update. The corn export projection was unchanged on the month, but that’s highly dependent on a strong performance for that critical second crop. The Rosario Grain Exchange estimates Argentina’s corn crop at 47.7 million tons, under their most recent estimate and less than what the USDA is expecting. Weekly corn exports were a marketing year high at more than 2.1 million tons, with big sales to unknown destinations and Japan. The trade will be watching where those sales to unknown destinations end up being delivered. China reportedly has a significant amount of corn in Ukrainian ports, unable to be shipped. Ethanol futures were unchanged.
The wheat complex was mostly sharply lower on a combination of profit taking, fund liquidation, and spread trade, including a loss of $1.14 and ½ in May Chicago, out of an expanded trade limit of $1.30. Wheat is continuing to monitor Russia’s invasion of Ukraine, with no reported progress in diplomatic talks, but the trade remains concerned about demand around these price levels. Russia is reportedly allowing some boats to pass from the Sea of Azov into the Black Sea to ship grains, while key Ukrainian ports remain under attack by Moscow. Russia and Ukraine combine for about a third of the world’s wheat exports. Parts of the Plains have recently received precipitation, just not enough to break drought conditions. Weekly U.S. wheat sales were above average, but only just over 300,000 tons, with the 2021/22 pace continuing to trail 2020/21 at the start of the fourth quarter.