Soybeans soar as corn, wheat consolidate

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Soybeans soar as corn, wheat consolidate

Soybeans were sharply higher on commercial and technical buying. Soybeans were oversold, the fundamentals remain supportive, and soybean products were higher, also supported by commercial buying tied to demand expectations. Old crop soybean export sales were down sharply on the week after a cancellation by China, but new crop sales were solid thanks to unknown destinations and Mexico. More near-term planting delays are likely in some key U.S. growing areas. A big question right now is how many acres will be planted in North Dakota, one of the biggest soybean growing states. Celeres is projecting Brazil’s 2022/23 soybean crop at 148.8 million tons, expecting an increase in planted area to meet global oilseed demand. Exports this marketing year are pegged at 78 million tons, climbing to 94.5 million next marketing year, with the domestic soybean crush also expected to rise.

Corn was mixed, adjusting spreads. Corn made a big advance in planting last week and development conditions are improving in much of the region. Emergence remains slower than normal, but the warmer pattern expected to start in much of the region this weekend should help. Old crop export sales were a marketing year low following cancellations by South Korea, unknown destinations, and China and new crop sales were bearish. A question for corn is sustained demand from China. China has been a big buyer of U.S. corn with Ukraine out of the market following Russia’s invasion, but Beijing has recently agreed to import corn from Brazil, as long as it meets phytosanitary standards, and China is doing at least some export business with Russia as well. Most forecasts have more mixed weather for Brazil’s second corn crop, the largest of the three and the source of most of their exports, but production should still be much larger than last year.

The wheat complex was mixed, consolidating after the recent drop. There has more talk Russia will open an export corridor for Ukraine, but there’s been no action. Negotiations led by NATO are ongoing and it remains to be seen how many concessions will be made to Moscow in the face of the invasion, theft of equipment and grain, and alleged war crimes. More spring wheat planting delays are likely starting later this week in the northern U.S. Plains and Canada. Recent rain in the hard red winter region is mostly too late to help and while portions of the soft red winter region are excessively wet, that part of the crop is in relatively good shape. A recent wheat tour in Illinois did find yields below the USDA’s most recent guess, with the next projection out June 10th. With just a few days remaining in the 2021/21 marketing year, last week’s old crop wheat export sales were a net reduction following a couple of cancellations and new crop sales failed to break 250,000 tons. The USDA’s attaché in India has slashed its wheat production outlook to 99 million tons, down from 110 million, following higher than normal temperatures starting in mid-March. The trade is also monitoring development weather in France and planting activity in Argentina and Australia.