Market News

Corn, soybeans pressured by a forecast for rain in Argentina

Soybeans closed lower, pressured by the drop in soybean meal and improved chances for rain in Argentina later this week.  A decent rainfall could provide a boost to a crop that’s been facing significant drought stress.  Just 19% is rated good to excellent by the Buenos Aires Grain Exchange.  On the other hand, crop conditions in Brazil have been mostly favorable and there is anticipation of a record-large corn crop.  Reports of worsening COVID conditions in China also added pressure to the market Monday.  Soybean prices in China are near the lowest level in a month. 

Corn was lower, pressured by the potential for rain in Argentina and ongoing concerns about slow corn demand in 2022-23.  Ethanol demand continues to be a bearish concern after plant margins dropped significantly in the last month, along with lower gasoline demand.  Recent rains in Brazil with more precipitation forecasted in South America provide support to crop development in that part of the world, but also increases the competition from Brazil.

The wheat complex was lower on fund and technical selling.  The outlook remains bearish with Russia continuing to hold a big chunk of the export market, along with Ukraine.  While the turmoil in the Black Sea region continues, the market has shrugged a lot of it off.  However, U.S. and global wheat supplies (not counting China) are estimated at their lowest level in 15 years, it could change the direction of the wheat market.  With the bitterly cold temperatures in the forecast, winterkill in the U.S. is a concern.