Market News

Wheat higher Friday on winter storm concerns

Soybeans were modestly lower on profit taking and technical selling but closed well above the session lows and saw a solid weekly gain. That week-to-week rise was largely linked to strength in soybean oil, which was tied to a sharply higher move in crude oil on supply concerns. Friday, CONAB cut its guess for Brazil’s soybean crop by 0.1%, but it will still be record large at 177.847 million tons, with harvest just past the halfway point and CONAB also anticipating an all-time high for exports. Crop condition ratings have improved in portions of Argentina after recent rainfall. The USDA’s updated supply and demand estimates are out April 9^th, with CONAB’s next round of numbers for Brazil out on the 13^th. Stateside, beans are watching conditions ahead of widespread planting. They’re also waiting to see what happens in the weekend meeting with U.S. and Chinese trade negotiators ahead of the end-of-month talks by President Trump and President Xi. There are also some questions about new inspection requirements slowing down movement of beans from Brazil to China. Soybean meal and oil futures were mixed, consolidating. The NOPA member crush numbers for February are out Monday.

Corn was higher on short covering and technical buying, along with the rally in crude oil, adding to the week’s modest gains. Crude oil was down during the early part of the session, prior to rallying on supply concerns linked the military action in Iran and around the Middle East. CONAB’s guess for Brazil’s total corn crop was 0.1% lower than last month at 138.27 million tons, largely due to some acreage changes for the first and second crops. The first crop is now pegged at 27.35 million tons, up 2.4% from February, with the second crop at 108.435 million tons, down 0.8%. A year ago, Brazil’s corn crop was 141.158 million tons, including a first crop of 24.936 million tons, a second crop of 113.228 million tons, and a third crop of 2.994 million tons. First crop harvest and second crop planting activity are ongoing. The trade is also monitoring U.S. conditions ahead of key USDA numbers and widespread planting. The USDA’s Prospective Plantings and Quarterly Grain Stocks reports are out on the 31^st.

The wheat complex was higher on fund and technical buying, with the three U.S. pits mixed on the week. Chicago and Kansas City are wary of potential freeze damage to winter wheat ahead of a storm in the Midwest and Plains, while Minneapolis is looking at weather ahead of spring planting. Globally, the trade’s watching conditions ahead of full emergence in Europe and the Black Sea region, along with any further impact from Russia’s ongoing war with Ukraine. Concerns about fertilizer prices are also supportive for wheat. Export demand for U.S. wheat is still better than expected, even with the recent strength in the dollar, relatively high U.S. prices, and an ample world supply.