Traders yesterday on Chicago, has took an opportunity to engage in some technical selling and profit-taking as they squared positions ahead of the next World Agricultural Supply and Demand Estimates (WASDE) report, which USDA will release tomorrow morning.
USDA’s US Crop Condition report, indeed, saw spring wheat was 70-per-cent planted versus 49pc last week and 51pc average for this time of year, and winter wheat was rated as 49c good to excellent, up from 48pc last week.
On row crops, corn was estimated at 67pc planted vs 46pc last week and 52pc average, and soybeans were seen as 42pc planted versus 24pc last week and 22pc average.
And all that has gove more pressur on prices, of course.
Consequentially, corn prices spilled 2.5% to 3.25% lower.
Wheat prices were also down significantly, with most contracts down 4.5% to 5.75%.
Soybeans were relatively spared, finishing the session with just minor changes.
The financial, industrial and energy sectors – which all are leaning heavily on economic recovery – have tended to do well in recent weeks.
However, on Wall St., the Dow at last fell 35 points, trading to 34,742.
Crude oil, meantime, was holding steady, while gasoline and diesel each trended about 0.2% higher.
The U.S. Dollar softened slightly.
Coming back on the grains market, corn prices stumbled significantly on a round of technical selling and profit-taking, triggered by ample planting progress this past week and as traders took the opportunity to unload some of their very net long position ahead of Wednesday’s WASDE report, also following new price highs negotiated last week.
The new announcement of exceptional sales for 1.02 Mt of corn to China after Friday’s sales, which also exceeded 1 Mt, did not contain the downward movement.
To note also China cancelled 280,000t of current-crop corn purchases from the US, meantime.
The corn thus comes to test its first support zones.
Wheat prices, on their part, took a massive hit yesterday on a round of technical selling spurred by improving weather forecasts for the Great Plains.
The improved moisture outlook for both the US and Canada got some airtime but this looked more like taking some chips off the table.
The market is looking for a global wheat ending stocks number of 295.38Mt, down slightly on the USDA April figure of 295.52Mt, and a new-crop average guess of 294.29Mt.
Spillover weakness from corn applied additional headwinds.
Soybean prices, meantime, wobbled in a choppy session but closed with very minor changes amid some uneven technical maneuvering, as traders attempted to balance solid planting pace this past week against historically low US stocks.
Corn export inspections reached 67.2 million bushels last week, spilling moderately lower from a week ago but still making it to the higher end of trade estimates.
Mexico and China led all destinations.
Soybean export inspections saw week-over-week improvements of 64%.
That was on the higher end of analyst estimates.
Indonesia and Mexico were the top two destinations.
Wheat export inspections inched slightly ahead of the prior week’s tally to 20.0 million bushels.
That was also on the higher end of trade guesses.
China was the No. 1 destination.
In this context, corn basis bids were steady to mixed across the central U.S. Monday, firming as much as 5 cents higher at an Ohio elevator while sliding a penny lower at an Illinois river terminal.
Soybean basis bids fell 8 cents lower at an Illinois river terminal while firming 2 cents higher at an Iowa river terminal and holding steady elsewhere across the central U.S..
The situation still remains tense internationally, especially in Brazil.
The decline in production potential in this country is thus confirmed for the second corn harvest affected by the drought.
Local analysts are now and unsurprisingly revising their estimates downwards.
AgRural in Brazil printed 95.5Mt last night, well down on their previous estimate of 103.4Mt.
Adjustments to the Brazilian situation could also be recorded in the USDA monthly report update for May.
USDA printed a Brazil corn number of 109Mt, but the streets’ average guess is 103Mt for the May report.
On European market, the meteorological conditions are reassuring in the areas where obviously rains have been recorded.
This element, favored the easing of prices after the strong increases recorded last week.
Prices on Euronext thus marked a sharp decline for both cereals and oilseeds.
The amplitudes of variation were also significant with wheat prices falling by -8.50 € / t on the September 2021 deadline.
The forecasts of new precipitation in France, in the coming days, thus bring a reassuring factor in the prospect of an improvement in the condition of the crops and for the emergence of spring crops.
In corn, prices were also down yesterday for both old and new crops.
Rapeseed, for its part, was weighed down by the fall of the palm on the Kuala Lumpur Stock Exchange (-7%!).
The MPOB (Malaysian Palm Oil Board) announced a rebound in Malaysian stocks last month, to 1.55 Mt, the highest since last November.
The national production indeed recovered during the period, while the domestic consumption, it marked a notable contraction (-192 kt).
The conditions for developing sunflower crops will be in the current tense oilseed context to be monitored closely.
Soft wheat exports from the European Union in the 2020/21 season that started last July had reached 22.84 million tonnes by May 9, data published by the European Commission showed on Monday.
That was down from 30.59 million tonnes cleared by the same week last season, the data showed.
That’s down 25% from last year’s pace so far.
EU 2020/21 barley exports had reached 6.68 million tonnes, against 6.75 million a year ago, while EU 2020/21 maize imports stood at 12.72 million tonnes, down from 17.89 million,a year-over-year decline of 29% so far.
European Union soybean imports during the 2020/21 marketing year reached 475.8 million bushels through May 9.
That’s slightly above last year’s pace.
EU canola imports are also trending slightly higher year-over-year, while EU soymeal imports are moderately below last year’s pace.
Since Jan. 1, the European Commission’s data has covered the EU’s 27 countries only, whereas previous figures up to Dec. 31 covered both the EU-27 and Britain.
From Black Sea basin, reports are coming through about conditions in Russia being too wet.
Historically, that has been a nice problem to have and generally leads to yields and production outperforming.
Meantimem, spring wheat and barley planting is now complete in Ukraine.
The sowing of corn, sunflower and soybeans is also progressing at high speed.
Despite the efforts of producers to advance as much as possible in the sowing, the delay in sowing remains very significant due to the heavy delay accumulated at the start of the season.
If last year the sowing work was in the finalization phase, it is only 50% advanced this year.
In corn for example, last Friday 2.4 Mha had been sown against 4.9 Mha last year.
In sunflowers, 3.2 Mha were in the ground on Friday against 6.4 Mha already last year.
From the Middle Kingdom, China sold another 5.2 million bushels of its state wheat reserves last week, which was only 3.6% of the total available for sale.
China has offered nine other wheat auctions since the beginning of March as it attempts to lower feed costs for its domestic livestock and poultry producers.
From Australia, showers pushed through across parts of South Australia yesterday and have helped to dampen topsoil.
Growers can now continue to plant or get germination on what has been planted dry.
Parts of southern New South Wales also received some rain in the past 24 hours.
Another wide spread rain is needed across most of the NSW grainbelt to keep it in the game.
Both current and new-crop local markets were fairly quiet, with values largely unchanged across the boards, and small trades on the current crop for barley and wheat.
New crop canola continues to tick over with growers selling with confidence that have received good rainfall for date
We still continue to see a solid bulk program on paper with wheat pushing 3mmt for the month of May.
Canola export pace remains strong with another 350,000t on the stem for May.
On the international trade scenario, Indonesia issued an international tender to purchase 6.6 million bushels of animal feed wheat from optional origins that closes tomorrow.
The grain is divided into six consignments that are for arrival between June and August.
South Korea purchased 2.2 million bushels of animal feed wheat, likely sourced from the Black Sea region, in a private deal that closed on Friday.
The grain is for arrival around August 10.
Tonight we will see how the sessions close.
