Market News
Quiet, mixed end to the week for corn, soybeans, wheat
Soybeans were narrowly mixed after a lower start to the session, with the most active months modestly to solidly lower for the week. Brazil’s harvest remains slower than average and just 6% of Argentina’s crop is rated good to excellent. CONAB may have raised its projection for Brazil’s soybean crop this week, but that’s seen as questionable, while the major grain exchanges in Argentina lowered their outlooks recently because of dry conditions in key growing areas during much of the season. Rain in the forecast for the coming week in Argentina could help, but totals and coverage are uncertain. There has not been an announced U.S. soybean export sale since late January. Soybean meal was down on demand concerns because of increased incidences of ASF in China, but managed to finish above the session lows, while bean oil hit new highs on solid global vegetable oil demand, following the lead of palm oil.
Corn was mostly lower on spread adjustments, favoring nearby months over deferred contracts, while ending the week on a lower note overall. That slow soybean harvest in Brazil is delaying second crop corn planting and the good to excellent rating for Argentina fell over the last week. CONAB raised its estimate for Brazilian corn production because of increased planted area in that critical second crop, but the delays have pushed activity past the optimal window in parts of the nation. Portions of Argentina are expected to receive much-needed rainfall in the coming week, but at least some yield potential has been lost. Chinese corn prices were lower ahead of the U.S. session on feed demand uncertainties. The trade is also watching conditions in the Midwest ahead of widespread planting, with the USDA’s prospective planting numbers out March 31st, along with quarterly grain stocks. Ethanol futures were unchanged.
The wheat complex was mixed, with Chicago and Kansas City down and Minneapolis mostly fractionally higher. Technically, contracts are oversold, but most forecasts have near-term precipitation in large portions of the U.S. winter wheat growing area. That should also help recharge soil moisture ahead of spring wheat planting in the northern U.S. Plains, but could miss some of the drier sections of the region. The trade is also watching conditions ahead of the next round of planting in Canada, Russia, and Ukraine, along with harvest activity in Australia. Trade group Coceral lowered its soft wheat crop estimate for the European Union and United Kingdom to 141.5 million tons on lower-than-expected planting area in some nations. Production would still be well above a year ago. The global crop is in good shape and the supply fundamentals remain bearish, with the next set of supply and demand estimates out April 9th. DTN says Egypt bought 360,000 tons of wheat from Romania, just days after Egypt’s supply ministry said it had four months of wheat in reserve. Egypt is the world’s biggest wheat importer, largely because of a government subsidized bread program. Overall, export demand for U.S. wheat has slowed down, but white wheat is seeing comparatively solid demand from China as Beijing increases wheat feeding in place of higher priced ingredients.
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