Market News

Grains, oilseeds up Friday, but mostly down on week

Soybeans were higher on fund and technical buying, still ending the week with losses. Soybeans had some help from the strength in meal and unknown destinations buying 124,000 tons of old crop ahead of the open. That was the second old crop purchase by unknown during the business week for a total of 248,000 tons, with unknown also buying new crop U.S. beans this past Wednesday. Brazil’s harvest is around 80% complete and Argentina is above 10% finished. Any questions about the discrepancy between USDA and CONAB projections for Brazil’s bean crop seem to have run their course, while recent estimates for Argentina’s crop have also come in below the most recent USDA expectations. The USDA’s next round of supply and demand estimates is out May 10th, with CONAB’s updated outlook for Brazil set for May 14th. Soybean oil futures were mixed on bear spreading, with nearby contracts down and deferred months up. The trade is also monitoring U.S. conditions ahead of widespread planting, with the USDA’s first estimate of the season expected in Monday’s weekly crop progress and condition report. China’s General Administration of Customs says soybean imports for March dropped 20% on the year, likely due to poor domestic crush margins, with first quarter 2024 imports the lowest since 2020.

Corn was higher on fund and technical buying but closed out the week narrowly mixed. The solid USDA domestic and export demand projections continue to be the big supportive factors for corn. The USDA might not have changed the export guess in this month’s supply and demand report, but there is some expectation for an adjustment in May. That report will also have the first new crop U.S. projections of the growing season. Using a trend line yield on planted area of 90 million acres, that’d be a carryout of around 2.3 billion bushels, but it’s highly likely the number of acres planted, and the final yield will differ from current expectations. Near-term U.S. weather looks mostly favorable for planting, but there could be widespread delays later in the coming week. More rain will be needed in central Brazil for second crop corn as South America gets ready to enter an anticipated drier pattern after the end of El Nino. The Buenos Aires Grain Exchange says 15.3% of Argentina’s corn crop is harvested, faster than average. There are reportedly significant problems with leafhoppers in Argentina this year, but the crop should still be a lot larger than last year.

The wheat complex was higher on fund and technical buying, but not finding enough support to pull contracts out of the red for the week. Most of the hard red winter region is warm and windy, with the chance for frost in some areas in the coming week. Soft red winter development conditions are generally more favorable, but parts of the region have too much soil moisture. Globally, the Black Sea region is generally dry, while parts of Europe are excessively wet. Some winter wheat growing areas of Australia remain dry, but there could be some relief coming in the next couple of months. However, there doesn’t seem to be a whole lot of immediacy in the trade connected to global weather because of slow U.S. exports, even if the USDA is projecting the tightest global supply in several marketing years, which gets even tighter when China, who only trades minor amounts of wheat globally, is removed from the equation.

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