Market News

Soybeans, corn start week on higher notes, wheat steady to up solidly

Soybeans were higher on short covering and technical buying. There was also likely some commercial interest as crush margins are solid, which supported soybean meal and oil futures Monday. Soybeans are monitoring early U.S. planting weather. The USDA says 23% of U.S. soybeans are planted and 8% has emerged, both ahead of the respective five-year averages. There are a lot of questions about next month’s trade talks with China. That at least to some degree hinges on what happens in Iran and the Middle East. Crude oil was higher Monday on concerns about conflict negotiations. Soybean export inspections were down on the week, up on the year, primarily to China and Mexico.

Corn was higher on short covering and technical buying. Corn is monitoring planting weather, expecting more rain in parts of the Corn Belt for much of this week. While widespread rainfall is seen as a long-term benefit for development, the precipitation has missed portions of the region and some areas have also experienced severe storms and flooding. As of Sunday, 25% of U.S. corn is planted and 7% has emerged, compared to 19% and 4% on average, respectively. Dry weather is an issue for some second crop growing areas in Brazil, leading to some talk about production cuts. The USDA’s next round of supply and demand numbers is out May 10^th, with CONAB’s updated outlook for Brazil set for May 14^th. U.S. corn export inspections were lower than last week and last year, but still solid, with Mexico and Colombia leading the way.

The wheat complex was mostly higher, with Chicago and Kansas City up on speculative and technical buying. Wheat is monitoring the rain chances for very dry portions of the central and southern U.S. Plains. Recent rainfall has missed some areas and while there are more chances in the hard red winter region this week, coverage and totals are uncertain and it might be too little, too late. In comparison, some U.S. soft red winter growing areas might be too wet. Minneapolis was mostly up, with the May contract steady in preparation for the first notice day. For winter wheat, 25% of the crop is rated good to excellent, unchanged on the week, and 34% has headed, compared to 21% most years at this time. For spring wheat, 19% of the crop is planted, compared to the typical rate of 22%, and 5% has emerged, compared to 4% on average. Fertilizer availability and dry weather could impact planted area in Australia. The trade’s also looking at conditions in Argentina, Canada, Europe, Russia, and Ukraine. There is the potential for frost damage in parts of the Black Sea region this week. France’s Agrimer says 83% of that soft wheat crop is rated good to excellent. U.S. export inspections were below a week ago and a year ago, with the Philippines and Japan topping the list.