Grain prices were mixed yesterday.
Corn prices dropped 2%, after USDA reported better-than-expected quality ratings.
Winter wheat also faced moderate cuts.
Soybeans and spring wheat, in contrast, saw an upside, with both commodities rising more than 1% higher.
Spring wheat contracts, in particulsar, seems are moving back towards $8 per bushel, because forecasted dry weather in key production states.
Soybeans, meantime, were lifted by surging soybean oil prices.
Soybean oil stocks in the US are now down 18% from last year.
On macro markets, energy prices grabbed healthy gains.
Crude oil was up another 1.5%.
Diesel also rose about 1.5% higher.
Gasoline was up 1%.
Retail and energy stocks, indeed, continue to perform well.
Meantime, on Wall St., the Dow inched 25 points higher to 34,600, while the S&P moved fractionally higher to stay near all-time highs.
The U.S. Dollar firmed slightly.
Coming back on agrimarkets, the Purdue University/CM Group Ag Sector Barometer fell 20 points to 158 in May, the lowest reading since September 2020, reflecting farmers’ concerns about the country’s agriculture economy.
Meantime, it should to note, that live cattle futures traded on the CME yesterday concluded the day 2.3 percent higher, at $1.1975c/lb, after plunging in response to a cyber-attack on JBS systems.
About grain prices, corn sagged after USDA showed this year’s crop continues to be planted faster than average, with higher-than-expected crop quality.
That triggered a round of technical selling that pushed prices down as much as 2%.
In fact, corn plantings are now 95% complete through Sunday, up from 90% a week ago.
That’s a bit faster than 2020’s pace of 92% and moderately ahead of the prior five-year average of 87%.
And 81% of the crop is now emerged, up from 64% last week and well above the prior five-year average of 70%.
USDA’s initial corn quality ratings were higher than expected, with 76% of the crop rated in good-to-excellent condition.
Another 20% of the crop is rated fair, with the remaining 4% rated poor or very poor.
Soybean prices enjoyed some spillover strength from red-hot soyoil prices, which rose more than 5%, on global supply concerns.
Consequently, soybeans closed around 1% higher after an often choppy session.
Meantime, soybean planting progress improved from 75% a week ago up to 84%.
That was three points below the average trade guess but still far ahead of 2020’s pace of 74% and the prior five-year average of 67%.
And 62% of the crop is now emerged, up from 41% a week ago and much faster than the prior five-year average of 42%.
In this context, corn basis bids were steady to soft, dropping 2 to 6 cents lower across a handful of Midwestern locations.
Also soybean basis bids were largely steady, even if did slide as much as 5 cents lower at an Iowa processor while firming as much as a penny higher at an Iowa river terminal.
Wheat prices were mixed as winter wheat contracts fell after USDA reported improved crop conditions, while dry weather patterns helped spring wheat prices firm more than 1.5% higher after a round of technical buying, moving Minneapolis to became, the new driver of the ag markets.
Winter wheat quality, indeed, ratings improved a point, moving to 48% rated in good-to-excellent condition and mirroring analyst expectations.
Another 33% of the crop is rated fair (down two points from last week), with the remaining 19% rated poor or very poor (up a point from last week).
Physiologically, 79% of the winter wheat crop is now headed, up from 67% last week and slightly above the prior five-year average of 78%.
Spring wheat plantings, meantime, took another small step toward completion, moving from 94% a week ago up to 97% through Sunday.
That’s a faster than 2020’s pace of 90% and the prior five-year average of 93%.
USDA has marked four of the top six production states as 100% complete, and 80% of the crop is now emerged.
However, quality ratings eroded two points lower from a week ago, with 43% of the crop rated in good-to-excellent condition.
From South America, financial services provider StoneX, formerly INTL FCStone, has gone hard on Brazil, posting a 89.68 million tonnes corn (Mt) crop estimate.
This comes off the back of yesterday’s 90.9Mt AgRural print which makes the USDA’s 102Mt estimate seem high.
On European market, operators were hesitant yesterday.
Some sales, indeed, showed technical resistance levels, such as € 220 / t on Euronext wheat maturing in September 2021.
Corn expiring in June is no longer representative at only 2 days of its fencing.
Meantime, rapeseed rose, even if only slightly yesterday, but should again find support today, like the rise in vegetable oil prices, especially palm oil again this morning in Kuala Lumpur.
Soybean oil prices are at their highest for 10 years.
In France, it was yesterday’s thunderstorms that dominated the news with significant damage in places.
The latter should still be rife today before the return of calmer weather for the weekend.
Meantime, per the latest data from the European Commission, EU corn imports for the 2020/21 marketing year, through May 30, reached 13.34 million tonnes against 18.66 million last year to date, it is a year-over-year decline of 28.5%.
Soybean imports have reached 508.5 million bushels, representing a fractional year-over-year decline so far.
EU canola imports are slightly higher versus a year ago, stand at 5.88 million tonnes, compared to 5.71 million last year to date.
Meantime, with EU soymeal imports facing a moderate year-over-year decline.
Soft wheat exports, have reached 24.46 million tonnes against 32.68 million the previous year.
It is a year-over-year decline of 25%.
Also EU barley exports are fractionally lower from a year ago, with 7.01 million tonnes compared to 7.03 million.
From Black Sea basin, rain in Russia is not all bad this time of year bearing in mind that spring wheat contributes around 25pc of total wheat production which is certainly benefiting from the current wet pattern.
Russian Prime Minister, however, confirmed that he would leave the export tax system in place as long as food inflation was present in the country.
Meantime, Ukraine’s corn exports during the 2020/21 marketing year have reached 846.4 million bushels so far, per the latest data from the country’s agriculture ministry.
Ukraine’s wheat exports have reached 587.9 million bushels of wheat so far in the 2020/21 marketing year.
Total grain exports are down around 22% year-over-year so far.
On spot market, corn appears as a premium of + $ 45 compared to 11.5% wheat, on a CPT Odessa basis.
In the new harvest, corn retains a premium over wheat of + $ 5 / t, which is certainly lower than on the spot.
Thus, if wheat has been reluctant since the beginning of the week to return to $ 250, in delivery, it is now done for corn which was posted yesterday at $ 251 for October / November delivery, against a new harvest wheat at $ 246 / t.
New harvest feed barley destined for China is at 238 $ / t.
From Australia, Rabobank released it’s latest Australian winter crop outlook with a near record planted area going in with ideal conditions, total winter crop plantings projected 22.93 million hectares, up 2pc on previous year.
ABARES will release a report this month.
Aussie local markets, meantime, kicked along yesterday following the strong move on the offshore boards.
We saw current crop wheat and barley find a bid along the east coast and tonnes continue to move out the door.
It still feels well supportive with current export program plus domestic buying for the next 3-month cover.
New crop markets were firmer across all commodities yesterday with wheat up $3-4/t, barley up $2-3/t.
Canola moved strongly again, values pushing firmer by $20/t. WA canola grower bids advanced towards $800/t FIS.
On the international scene, Indonesia is buying 180,000 t of feed wheat.
International operators confirm that on Saudi Arabia’s purchase of 562,000 t of milling wheat, the origins could be mainly Baltic.
Tonigth we will see how the sessions close.
