Market News

Grains, oilseeds end week gaining strength

Soybeans closed the week gaining support. The complex is being supported by continued drought pressure in Brazil. Some scattered rains in Brazil and Argentina added downward pressure in the market early this week. Struggling South American crops have given U.S. beans support on the global market, even with elevated prices. The USDA announced the sale of 132,000 metric tons of old crop soybeans to China Friday morning. That was the third announced soybean sale of the week, the other two were marked for unknown destinations. While the market is reacting positively to news of export sales, the mood might change unless export inspections start to match pace. The soybean complex saw a back-and-forth week with strong gains Wednesday, losses Thursday and a higher close on Friday. Crude oil was more than $9 higher on the week, which added upward momentum for soybean oil. Bean oil has also gained strength as expectations of Ukraine producing a quality sunflower crop, or any crop at all, are dwindling. But, even with the conflict ongoing, Ukrainian farmer Kees Huizinga says farmers in the region are attempting to start planting crops for this year. May soybeans closed nine and a half cents higher at $17.10 and a quarter, July soybeans were six and a quarter higher at $16.88 and a half, May soybean meal closed $2.00 higher, and May soybean oil closed 46 points higher.

Corn futures closed higher with the market fixated on the Black Sea region. Continued Russian attacks on Ukraine have kept the market at elevated levels. Corn futures are also watching South America’s second crop corn – the safrinha crop. Brazil’s crop is only rated around 30 percent good to excellent with 10 percent of it planted. Scattered rains to start the week could boost the crop’s condition ratings though. The U.S. Energy Information Administration says daily ethanol production was up this week. The production of 1,042 barrels a day was up 16 barrels a day from last week and 14 barrels a day over two weeks ago. Ethanol demand has seemingly held its ground even with rising prices at the pump. There is still concern that spiking gas prices could keep drivers off the road and lower demand. If demand drops, there would be less gas for ethanol to be blended into. Poor weather in the southern U.S. has prevented early planting. Frost in Texas early this week might negatively impact corn that is already in the ground. May corn futures closed five and a half cents higher at $7.54, July corn closed six and a quarter cents higher at $7.34 and three quarters.

Wheat closed higher to end the week. The complex gained strength as key wheat growing states are seeing worsening drought conditions after light rains earlier this week. Friday’s gains to end the week nearly fully met Thursday’s losses. The market kept its volatile trend this week while watching the Black Sea region. Wheat futures are continuing to be propped up by tensions between Russia and Ukraine. A mix of peace talks in the region and Russian advances will likely continue to send the market sharply higher and lower from day to day. Ukraine’s ag minister this week said he expects only about half of the country’s crops to be seeded because of the conflict. Recent weeks have seen traders exit the market ahead of the weekend to negate risk of new developments while the market is closed. Because of the elevated prices, farmers are reporting struggles marketing any available wheat as buyers are holding out for lower prices. May Chicago closed 16 and a half cents higher at $11.02 and a quarter, May Kansas City closed 15 – and three-quarter cents higher at $11.10 and three quarters, and May Minneapolis led the complex ending Friday up 21 and a half cents at $11.04 and a quarter.