Market News

Soybeans surge on temporary tariff cut

Soybeans were sharply higher on commercial and technical buying. The main source of support was the 90-day lowering of reciprocal tariffs between the U.S. and China. This is an agreement-in-principal and further negotiations are expected in the coming days. Old crop ending stocks were down on the month and the first look at new crop stocks was below this marketing year. Globally, the USDA left 2024/25 production unchanged for Argentina and Brazil but did lower exports for those two nations and imports by China. CONAB’s updated outlook for Brazil will be out Thursday, the 15^th. The USDA says 48% of U.S. soybeans are planted, compared to the five-year average of 37%, with 17% emerged, compared to 11% on average. Export inspections were above a week ago, but below a year ago, primarily to Egypt and Indonesia. Soybean meal and oil were up on the strength in beans. Mexico bought 120,000 tons of U.S. beans ahead of the open, with 24,000 for 2024/25 and 96,000 for 2025/26.

Corn was mostly modestly higher on commercial spread adjustments. Old crop stocks were below April, but new crop stocks look large due to a bigger crop in 2025 than 2024. The numbers are going to change as planting is ongoing and the yield estimate being used by the USDA can be viewed as optimistic. USDA is anticipating all-time highs in supply and total use next marketing year. Global changes for 2024/25 were minimal. As of Sunday, 62% of U.S. corn is planted, compared to 56% on average, and 28% has emerged, compared to the normal rate of 21%. Export inspections remained ahead of the pace needed to meet projections for 2024/25, which runs through the end of August. Japan and Mexico were the top destinations. APK-Inform lowered its outlook for Ukraine’s crop to 27 million tons, a drop of 7.3% from the prior guess. The trade is also monitoring harvest activity in Argentina and second crop development conditions in Brazil.

The wheat complex was lower on speculative and technical selling, along with the higher trade in the dollar during the session. U.S. winter wheat production is expected to be up on the year thanks to an improvement in yield canceling out a decline in harvested area. Hard red winter, soft red winter, and white winter wheat production are all projected to surpass 2024. That pushed new crop stocks above the USDA’s current guess for old crop, with the 2025/26 marketing year getting underway June 1^st. The USDA’s adjustments to world supply and demand numbers were minimal, with the next round of projections out June 12^th. For winter wheat, 54% of U.S. winter wheat is in good to excellent shape, up 3% on the week and 4% on the year, with 53% headed, compared to the usual pace of 45%. For spring wheat, 66% of the crop is planted and 27% has emerged, both ahead of the typical rates. U.S. export inspections were below last week, but above last year, mainly to the Philippines and Mexico. APK-Inform now has Ukraine’s wheat crop at 21.8 million tons, rising 1.5% from the prior projection. Wheat’s waiting to see what comes next in negotiations to end Russia’s war on Ukraine.