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Soybeans, corn down ahead of USDA numbers

Soybeans were lower on fund and technical selling. The USDA says China did buy old and new crop U.S. beans last week, but in relatively small amounts, and tariffs continue to impact sales with less than a quarter left in the 2018/19 marketing year. Also, the trade was watching planting weather, expecting at least some progress this week, and getting ready for Friday’s USDA numbers. President Trump and President Xi are scheduled to meet Saturday at the G20 in Japan and talk tariffs. Not much progress is expected in this round of discussions, but any progress would be welcome. If no agreement is reached, new U.S. tariffs on Chinese goods are expected. Soybean meal was down and oil was mostly lower, following beans. The first notice day for July contracts is Friday. Statistics Canada pegs 2019 canola acreage at 20.952 million acres, down 8.2% from 2018, because of the current bearish global vegetable oil outlook and trade tensions with China. Canadian soybean acreage is pegged at 5.714 million acres, a year to year decrease of 9.6%. The International Grains Council estimates 2019/20 soybean production at 349 million tons, compared to the late May guess of 358 million and the 2018/19 total of 363 million.

Corn was lower on fund and technical selling. Corn is watching late planting weather, with some key U.S. growing areas potentially wrapping up activity. The USDA’s quarterly grain stocks numbers are out Friday, along with what will probably be a questionable acreage report. The USDA is counting acres that have been planted along with acres that producers intend to plant in the weekly crop numbers, so the accuracy of the report is in at least some doubt and a resurvey of producers could be announced Friday. Prevent plant numbers are out in August. The reports are out at Noon Eastern/11 AM Central. Ethanol futures were lower, pressured by lower margins as cash corn prices move higher. Statistics Canada has 2019 corn planted area at 3.694 million acres, up 1.9% from 2018. The International Grains Council pegs 2019/20 world corn production at 1.095 million tons, compared to the last projection of 1.118 billion and the year ago total of 1.130 billion.

The wheat complex was mixed, with Chicago and Kansas City consolidating and Minneapolis up modestly. Wheat’s also watching weather, expecting generally improved winter wheat harvest activity and good spring wheat development conditions. The trade is also monitoring conditions in Australia, Canada, Europe, Russia, and Ukraine. Statistics Canada projects 2019 wheat acreage in that country at 24.595 million acres, down 0.6% on the year, with spring wheat at 18.772 million acres, 8.4% higher, durum at 4.894 million, a drop of 20.9%, and winter wheat at 929,000 acres, a decrease of 25%. Agritel has Russia’s wheat crop at 81.7 million tons, up sharply from 2018, even with hot, dry weather in parts of the country over the last few weeks, with exports of 37 million tons. DTN says the Philippines bought 95,000 tons of feed wheat, “likely” from the Black Sea region, and Saudi Arabia is tendering for 715,000 tons of milling wheat. The International Grains Council sees 2019/20 world wheat production at 769 million tons, compared to 766 million in May and 733 million in 2018/19.