Soybeans bounce back as corn, wheat fall further
Soybeans were higher on commercial and technical buying. Near-term weather is mostly cooler and its early in the growing season, but some areas do need rain. The USDA says 98% of this year’s crop is planted, compared to the five-year average of 97%, with 91% of the crop emerged, matching the average rate, and 7% blooming, compared to 11% normally in late June. 65% of U.S. beans are in good to excellent shape, 3% less than last week. A current question for soybeans is this year’s acreage total, with some analysts expecting Thursday’s planted area figure to be down from the March projection. Soybean products were up on solid domestic crush margins and strong commercial demand. Soybean oil had additional support from higher moves in palm and crude oils. China’s National Grain Trade Center says 24,500 tons of previously imported soybeans were sold at state auction last week, less than 5% of the offering. In the final quarter of the marketing year, soybean inspections are behind the year ago pace. Last week’s leading destinations were Germany and China. The new marketing year for soybeans, and corn, starts September 1st.
Corn was lower on fund and technical selling. Corn was also watching the near-term weather, even as many traders expected at least some decline in the USDA’s condition rating. As of Sunday, 4% of the corn crop is silking, in-line with the usual rate, and 67% of the crop is in good to excellent condition, 3% below a week ago. Planted area totals and quarterly stocks numbers are out Thursday, along with the weekly export sales numbers. Export inspections were up on the week and the year but continue to trail 2020/21. Last week’s biggest destinations were Japan and China. Demand for U.S. corn from China has dropped off dramatically, even with their domestic prices well above U.S. prices. The USDA’s attaché in Mexico estimates 2021/22 corn production at 27.8 million tons, 200,000 above the official guess due to a higher yield figure, with 2022/23 at 27.6 million tons. 2021/22 imports are seen at 17.5 million tons, rising to 17.7 million next marketing year. France’s AgriMer says 84% of that nation’s corn crop is in good to excellent shape, 3% less than last week and 5% below last year.
The wheat complex was lower on fund and technical selling. Winter wheat harvest conditions are mostly good and recent rain in the northern Plains should help spring wheat. For U.S. winter wheat, 95% of the crop has headed, compared to 98% on average, and 41% is harvested, compared to 35% typically this time of year, with 30% rated good to excellent, unchanged on the week. For spring wheat, 98% has emerged, compared to the five-year average of 99%, and 8% has headed, compared to 34% on average, with 59% of the crop reported as good to excellent, steady with the week before. Contracts are oversold, but slow demand is limiting any support. A few weeks into the 2022/23 marketing year, inspections are trailing the 2021/22 pace. Mexico and the Philippines were the top destinations last week. Many market-watchers had been anticipating at least some increase in demand for U.S. wheat following Russia’s invasion of Ukraine and the crop damage in India, but that hasn’t surfaced yet. Egypt says it is looking to buy 6 million tons of wheat between now and the end of the year, with Cairo recently agreeing to buy 180,000 tons of wheat from India. Egypt’s government says it has less than six months of wheat in state reserves. The USDA’s attaché in Mexico projects 2022/23 wheat production at 3.26 million tons, compared to the official ag department estimate of 3.27 million tons on a lack of rain and lower harvested area. Imports this marketing year are expected to be 5.2 million tons, compared to 5.1 million last marketing year. France’s AgriMer says 2% of that nation’s soft wheat crop has been harvested, with 64% of the crop in good to excellent condition, compared to 65% the week before and 79% a year ago.