Market News

Soybeans, corn, wheat fall, watching weather

Soybeans were sharply lower on fund and technical selling. Most forecasts have much-needed rain next week in Argentina, along with drier conditions in parts of Brazil. Some damage has been done, quality and yield in Brazil, yield primarily in Argentina, but a shift in weather would at least help crop conditions stabilize and speed up harvest activity in Brazil. The Rosario Grain Exchange cut its outlook for Argentina by 4 million tons to 45 million, compared to the most recent guess of 47.5 million from the USDA. CONAB’s new outlook for Brazil is due Thursday. Additionally, Chinese soybean and soybean product prices were lower heading into the U.S. session. The fundamental outlook continues to be bullish, but it was hard for contracts to get any real traction. The USDA’s weekly export sales numbers are out Thursday at 8:30 Eastern/7:30 Central. Soybean meal was lower on the same factors as beans, while bean oil was mostly lower, following the rest of the complex, except for soon to expire and relatively lightly traded March.

Corn was lower on fund and technical selling. Corn is watching conditions in South America, with second crop corn planting in Brazil much slower than average. That pace is almost entirely dependent on the speed of the soybean harvest and parts of that critical second crop will now be planted outside of the window for optimal yield, with CONAB’s new guess out Thursday. The USDA didn’t make any changes to its guess for Argentina, but that could change in April’s update. The trade is also watching U.S. weather ahead of widespread planting, with the prospective planting numbers out at the end of the month, along with quarterly stocks. China’s corn prices were lower ahead of the main U.S. session, but remain at elevated levels, even as new cases of ASF emerge. Ethanol futures were higher. The U.S. Energy Information Administration says ethanol production last week averaged 938,000 barrels a day, up 89,000 on the week, but down 106,000 on the year, with stocks slipping to a 14-week low at 22.07 million barrels, a decrease of 355,000 from the previous week and a drop of 2.264 million from a year ago.

The wheat complex was lower on fund and technical selling. A major storm in the U.S. Plains will help recharge soil moisture as winter wheat emerges from dormancy. That should also help ahead of spring wheat planting in the northern U.S. Plains and Canada. Several states are issuing weekly reports and the USDA’s weekly national crop progress and condition numbers resume in April. The global supply outlook continues to be bearish. The USDA did lower the 2020/21 world ending stocks estimate this week, mainly on increased feed wheat usage in China, but the number remains above the psychologically significant 300-million-ton level with wheat now in the final quarter of the marketing year. Egypt’s supply ministry says it has four months of wheat in reserve. DTN says Algeria bought 450,000 tons of wheat from unspecified origins.