Soybeans lose more ground as corn finishes firm
Soybeans were lower on fund and technical selling. Soybeans were up early, but couldn’t follow through, with sharp losses in bean meal and crude oil. Part of the losses were also tied to uncertainties about demand from China. That’s a two-fold issue, with Chinese economic concerns linked to COVID lockdowns and potential further retaliation over Speaker of the House Nancy Pelosi’s recent visit to Taiwan. China has reportedly canceled some U.S. soybean purchases in response to the visit. The USDA’s weekly export sales numbers are out Thursday at 8:30 AM Eastern/7:30 Central. Any weather concerns seem to be on the back burner for now. Domestic demand is solid, including strong cash demand for bean meal. Poland bought 135,000 tons of 2022/23 U.S. soybean meal. Poland typically sources bean meal from non-U.S. exporters, so the sale could be linked to a lack of available oil meals from Ukraine following the invasion by Russia.
Corn was modestly higher on fund and technical buying. Weather forecasts for this week are mixed, with rain in parts of the eastern Corn Belt against mostly hot, dry weather in the west. Even then, the rain is causing flooding in portions of the eastern Corn Belt and there is some scattered near-term rain in central and western areas. Ahead of next week’s USDA production numbers on Friday the 12th, some projections are for a lower yield estimate due to the recent weather issues. The U.S. Energy Information Administration says ethanol production last week averaged 1.043 million barrels a day, an increase of 22,000 on the week and 30,000 on the year, with stocks of 23.394 million barrels, up 66,000 from the week before and 745,000 from last year. CONAB says just over 70% of Brazil’s second corn crop is harvested, with the next production update out on the 11th.
The wheat complex was mixed with Chicago and Kansas City down and Minneapolis up. The trade is watching the tail end of this year’s winter wheat harvest and spring wheat development conditions, with hot, dry weather a concern for parts of the northwestern U.S. Plains. The northern Plains could see some near-term rainfall, but again, western areas of the spring wheat region might stay parched. Reports have as many as three ships a day being allowed to leave Ukraine’s ports following the export agreement with Russia. SovEcon says recent rainfall in Russia has lowered the quality of winter wheat but is expected to boost spring wheat yields. According to Romania’s Ag Minister, that nation will have a surplus supply of wheat, clearing the way for exports. Romania typically exports to the European Union and the Middle East.