Market News

Down day for soybeans, corn, and wheat

Soybeans were lower on commercial and technical selling. 76% of Brazil’s record soybean crop is harvested, helping them hold a huge share of the export market. Argentina’s government has reimplemented the soy dollar program to incentivize farmers to increase selling and exports, even with a much smaller crop due to drought. Stateside, the trade has an eye on corn planting delays in some areas, which could prompt some farmers to switch to soybeans. Losses in May soybeans were limited by a solid near-term demand outlook. The USDA’s next round of supply, demand, and production estimates is out Wednesday, April 11^th at Noon Eastern/11 Central. Soybean meal and oil also saw commercial pressure linked to tighter domestic crush margins. Ag commodities in general saw spillover from the stock market on economic growth uncertainties, along with crude oil dipping from its recent highs at times during the session prior to finishing firm.

Corn was lower on commercial and technical selling. 2% of the U.S. corn crop is planted with early near-term delays likely in parts of the Midwest, Delta, southeast, and Plains. It’s been a wet start to spring in many key U.S. growing areas, with the potential for flooding in parts of the Corn Belt as the snowpack in the northern Plains melts and heads downriver. Still, that warmer, drier pattern in the forecast for next week should help planting activity pick up steam in parts of the region. The trade is also watching development weather for Brazil’s second crop. There’s a chance for warmer, drier conditions that could cause some stress. The U.S. currently has the export advantage for corn due to seasonal factors, like Brazil’s second crop harvest being a few months off, in addition to the consecutive smaller crops in Ukraine. However, Brazil is still exporting part of their first crop, which is normally held for domestic use, with their March exports up sharply on the year. The U.S. Energy Information Administration’s weekly ethanol numbers are out Wednesday.

The wheat complex was modestly lower on profit taking and technical selling. The big issues are drought in the southwestern Plains and spring planting delays in the northern Plains, but wheat was overbought and due for at least some kind of a correction after the recent strength. 28% of winter wheat is good to excellent, down 6% from the USDA’s last rating from late November and below a year ago. That’s largely due to the drought sapping hard red winter potential in the Plains and likely leading to increased abandonment. Soft red winter conditions are comparatively good, maybe a little wet in parts of the eastern Midwest and southeast. This week’s winter storm in the northern Plains is expected to be mostly melted by next week, adding to the snowpack and raising chances of flooding. However, soil moisture levels have improved considerably in most of that region, which will help when planting actually gets underway. Dry weather is a concern for spring wheat in parts of the Canadian Prairies. Russia continues to hold most of the export market share, with Australia also a factor. Ukraine has become less of a factor because of Russia’s continued aggression and the slower inspections of ships trying to leave the Black Sea. Five Eastern European nations are also trying to halt imports of Ukrainian grain, which they say has harmed their domestic markets.