Market News

Soybeans bounce back ahead of close

 

Soybeans were higher on commercial and technical buying, rallying late. Trade talks between the U.S. and China are underway and while there are a lot of uncertainties about this round of discussions, the rally for beans came after the wrap-up of the first day of the meeting. Weekly export numbers were neutral to bearish. China did cancel old crop U.S. beans, but bought new crop. A couple of Chinese provinces will reportedly provide incentives to producers to increase soybean production. The spread has narrowed a little, but U.S. FOB prices remain below Brazil and Argentina. Brazil’s soybean exports in March were 10.26 million tons, up on the month, but down on the year. Soybean meal sales by Brazil were above both the previous month and last year. Soybean meal was lower and bean oil was higher on the adjustment of product spreads. Peru bought 30,000 tons of 2017/18 U.S. soybean oil. Peru typically buys bean oil from Argentina. The Buenos Aires Grain Exchange says 61.8% of Argentina’s soybean crop is harvested, back in-line with the normal pace after rain delays in some areas.

Corn was modestly higher on commercial and technical buying. Most forecasts have more near-term rain in the Midwest and Plains ahead of a better planting window for much of the region. The trade’s also watching dry forecasts for Brazil’s second crop, the bigger of the two and the source of most of their exports. FOB prices at the U.S. Gulf remain below FOB prices for Argentina, Ukraine, and Brazil. Ethanol futures were higher. The U.S. Census Bureau says March ethanol exports were 215.1 million gallons, the second highest on record for the month. he Buenos Aires Grain Exchange says 32.5% of Argentina’s corn crop is harvested. According to wire reports, the destination of 58,503 tons of U.S. sorghum was switched from China to South Korea.

The wheat complex was higher on commercial and technical buying, with Chicago and Kansas City leading the way up. Ongoing crop surveys in the Plains continue to confirm the poor condition of the region’s winter wheat crop, with yields in Kansas will below a year ago. Global crop conditions generally look good, aside from dry conditions in parts of the Black Sea region, and the fundamentals are bearish, with new supply and demand numbers out May 10th. Saudi Arabia is tendering for 540,000 tons of optional origin milling wheat and Jordan is in the market for 120,000 tons of milling wheat.