Market News

Corn up, trying to buy some acreage

Soybeans were lower on commercial and technical selling. The trade’s digesting last week’s bigger quarterly stocks number and record U.S. acreage estimate. Conditions in South America generally look good, with probable record production, and export competition is increasing. Near term forecasts for parts of Argentina do have heavy rainfall, but medium and long term outlooks are more conducive for development and harvest. Soybean meal was mixed, adjusting old crop/new crop spreads, and bean oil was lower. The USDA says February’s U.S. soybean crush was 151 million bushels, compared to 171 million in January and 155 million for February 2016.

Corn was higher on commercial and technical buying. Corn appears to be trying to buy some acres from beans, but the USDA’s guess of around 90 million acres would still be a lot of corn, even with near record demand. Corn’s also watching conditions in South America and expecting record production. The USDA’s next set of supply and demand estimates is out April 11th and next week’s crop progress report could have the first corn planting figure of the season. Ethanol futures were higher. According to the USDA, corn for fuel alcohol consumption in February was 423 million bushels, down 11% on the month, but up 1% on the year.

The wheat complex was mixed with Chicago up and Kansas City and Minneapolis down. Wheat acreage will probably be the lowest in about a century and most forecasts have more rain in winter wheat growing areas. The USDA says 51% of U.S. winter wheat is rated good to excellent, compared to 59% a year ago. The supply side of the market remains bearish, but lower U.S. yields and reduced planted acreage could reduce some of that negativity, at least domestically. Still, wheat is a very, very global market so any impact would probably be pretty minimal. DTN says South Korea bought 125,000 tons of feed wheat “likely” from the European Union.