Market News

Another round of losses in soybeans, corn, wheat

Soybeans were lower on fund and technical selling. Soybeans were down with liquidation in meal and spillover from crude oil in bean oil. Brazil’s record large harvest is nearly over and any concerns about U.S. planting delays were in the background Thursday. Brazil has held most of the export market share recently, but port premiums fell sharply this week amid logistical issues with that record crop and slower demand from China. Brazilian export group ANEC says first quarter imports by China from Brazil were 13.3 million tons, nearly 10% below a year ago. Weekly U.S. sales were sharply lower than last week, with the Netherlands and Mexico leading the way against a cancellation by unknown destinations. The International Grains Council estimates 2023/24 world soybean production at 401 million tons, compared to 399 million a month ago and 370 million for 2022/23. Trade, consumption, and carryover were also above a month ago. The USDA’s next round of supply and demand estimates is out May 12th.

Corn was lower on fund and technical selling. Corn ignored the likely planting delays over the next week or so in parts of the Midwest and Plains. Weekly export sales numbers were bearish after a significant cancellation by unknown destinations. Last week’s big old crop buyers were China and Saudi Arabia, while China and Mexico were the listed purchasers for new crop. Forecasts generally have drier weather in Brazil next month, potentially stressing the second corn crop, while the production outlook for Argentina remains dismal. Corn is also watching planting in Ukraine and waiting to see what happens with the Black Sea Grain Initiative. For now, China is buying more corn from Ukraine despite the deeper ties with Moscow. The International Grains Council projects 2023/24 global corn production at 1.208 billion tons, compared to 1.202 billion in March and 1.15 billion last marketing year. Trade was modestly lower than last month, while consumption and carryover guesses were higher. The USDA’s attaché for the European Union estimates 2023/24 corn production at 64.4 million tons, compared to 52 million in 2022/23, while anticipating higher exports and lower imports.

The wheat complex was lower on fund and technical selling. Grain is moving out of Ukraine again, including through a couple of the eastern European nations that blocked transit earlier in the week. Still, the European Union is expected to officially place an outright ban on imports of grain from Ukraine in five member states to support domestic producers, only allowing transport. The future of the Black Sea Grain Initiative remains in doubt because of Russia, asking for concessions and the end of sanctions, even as Moscow continues to wage war in Ukraine. Moscow is reportedly considering allowing grain exporters to redistribute quotas to aid in exports and prevent a domestic glut. U.S. old crop export sales last week were up sharply, mainly to South Korea and Taiwan. New crop sales can be viewed as routine. Rain in the southern U.S. Plains is too late to help all that much and there are spring wheat planting delays in the northern Plains, along with flooding concerns in that region and downriver. Parts of the central and southern Plains could see frost this weekend, likely further damaging the crop, reducing production prospects, and increasing the rate of abandonment. The International Grains Council sees 2023/24 world wheat production at 787 million tons, unchanged from last month and down from 803 million a year ago, with consumption also steady while trade and carryover were down slightly. The USDA’s attaché in the European Union sees 2023/24 wheat production at 137.8 million tons, compared to 134.3 million for 2022/23, with the office expecting lower imports and modestly higher exports.