Soybeans up on supply concerns
Soybeans were higher on commercial and technical buying, pulling contracts to a weekly gain. The USDA sees old crop stocks at multi-year lows, with the potential for further reductions, and there are uncertainties about U.S. acreage due to recent planting delays. Crush demand is strong and China bought 132,000 tons of old crop U.S. beans. China’s National Grain and Oils Information Center says domestic stocks passed 4.5 million tons due to lower-than-expected crush rates. Soybean demand from the world’s biggest buyer has tailed off a little recently due to tight crush margins, COVID lockdowns, and economic uncertainties. The Buenos Aires Grain Exchange says 65% of Argentina’s soybean crop is harvested, with 10% in good to excellent condition. The trade is also monitoring planting intentions in Brazil. Soybean meal was up on oversold signals while bean oil was mostly higher with commercial activity and both benefited from the higher move in beans.
Corn was lower on profit taking and technical selling, with old crop modestly lower on the week and new crop solidly higher. Near-term forecasts do show mostly good planting weather, but parts of the region are wet, further delaying activity. The recent storm in the north central Midwest likely didn’t impact the crop that much but did damage buildings and equipment. The USDA’s next round of crop progress and condition numbers is out Monday at 4 Eastern/3 Central. Solid overall demand limited losses, with the spotlight falling on both ethanol and export use. Thursday’s supply and demand update didn’t contain any significant surprises, outside of maybe, global old crop ending stocks. The Buenos Aires Grain Exchange reports 26% of Argentina’s corn crop is harvested, with 16% of the crop in good to excellent shape. Dry weather in central Brazil is causing at least some stress to their critical second corn crop. France’s AgriMer says 92% of that nation’s corn crop is planted.
The wheat complex was mixed Friday, while still finishing the week in positive territory thanks to Thursday’s surge in price. Parts of the southern Plains have seen some relief recently, but much of the region remains locked in drought, supporting Kansas City. Conditions in the northern Plains are mostly too wet to plant, helping Minneapolis close higher. Chicago was lower on profit taking and the generally good condition of the soft red winter crop. France’s AgriMer says 82% of that nation’s soft wheat crop is in good to excellent shape, down 7% on the week due to dry weather, but 3% more than this time last year. India has also recently experienced drier than normal weather, pulling some production projections lower. Combining those U.S. and world weather issues with the uncertainties about production in Ukraine following Russia’s invasion, the global fundamental outlook has shifted to neutral to bullish. Argentina, a net exporter of wheat, has become the first country to authorize planting of a GMO wheat variety, the product will not be immediately marketed due to buyer concerns. The Rosario Grain Exchange projects Argentina’s 2022/23 wheat crop at 19 million tons.