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Higher dollar sends grains and oilseeds lower

Soybeans were lower on speculative and technical selling, along with profit taking and spillover from the outside markets. The dollar index was higher while the Dow Jones Industrial Average and crude oil were lower. Soybean’s supportive fundamentals remain in place, but with the negativity in the outside markets, it was hard to get traction. According to the USDA, as of Sunday 87% of this year’s soybean crop has been planted, compared to five year average of 92% and 72% has emerged, compared to 83% on average. For the first condition rating of the season, 66% of soybeans are rated in the good to excellent category. Weather over the near term generally looks good for planting and development. Bean meal and oil were lower on the outside markets and the defensive trade in commodities. Losses in oil were limited by spread activity with meal and the monthly National Oilseed Processors Association’s monthly numbers. The May crush by NOPA member firms totaled 142.2 million bushels, compared to the average pre-report guess of 137.2 million and April’s total of 134.1 million. Soybean oil stocks came out at 2.684 billion pounds, compared to the pre-report expectation of 2.690 billion and the April total of 2.710 billion pounds. Brazil’s Soy Producers Association of Mato Grosso reports that there was a very small increase in soybean rust cases from 2008 to 2009, from 302 last year to 329 this year.

Corn was lower on fund and technical selling, in addition to outside market direction and profit taking. Weekly export inspections were within estimates but less than what’s needed weekly to meet USDA projections. The USDA reports that corn planting for pretty much all intents and purposes has wrapped up, 95% of the crop has emerged, compared to 98% on average and corn is in 70% good to excellent condition, up 1% from last week. The July contract has lost almost $.25 in the past two sessions, but did manage to hold above $4.05. Development weather looks good over the near term. Ethanol futures were lower.

The wheat complex was lower on technical selling and the higher dollar. Losses in Chicago and Kansas City were limited by a slowdown in harvest and quality concerns, while Minneapolis had some support from the slow spring planting pace. For spring wheat, planting is pretty much over, 93% has emerged, compared to 99% on average and 75% of spring wheat is rated in the good to excellent category, up 2% from last week. For winter wheat, 90% has headed, compared to 93% on average and 9% of the crop is harvested, compared to 19% on average with 44% rated in the good to excellent category, steady with last week. In the past two weeks, July Chicago has lost more than $1 and now looks at least somewhat oversold on a technical basis. European wheat was lower on fund selling and outside market influence; November Paris was down 1.2% and November London was 1.2% lower. Argentina’s Ag Secretariat states that dry weather continues to limit wheat planting.

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