Written Commentary
SOYBEANS
The soybean complex was mixed with May-23 down $.05 at $14.87 ¼, while other contracts were steady. Next support in May is $14.77 ½. Soybean meal was $1 – $3 lower, while oil was steady to 10 higher. Argentina’s preferred currency or “soy dollar” program went into effect this past Saturday. This program is expected to continue until May 24th where farmers will receive 300 pesos per dollar, well above the current market rate of 210. AgRural estimates Brazilian soybean harvest at 82% as of April 6th, just behind the YA pace of 84%. Friday’s CFTC report showed Money managers were aggressive buyers of soybean at over 46k contracts, extending their long position to 146k contracts. MM’s were light buyers of soybean oil, light sellers of meal. Soybean export inspections at 25 mil. bu. were at the upper end of the range of expectations. YTD inspections have reached 1.695 mil. up 2% from YA, vs. USDA forecast of down 7%.
CORN
Prices closed $.05 – $.10 higher led by old crop futures. Strong technical action today with old and new crop contracts both staging an outside higher close. I suspect the drought in the SW corn belt along with delays in the Northern plains offset expectations for good planting progress this week in the US Midwest. Export inspections at 32 mil. bu. were in line with expectations. YTD commitments at 794 mil. are still down 37% from YA, vs. the USDA forecast of down 25%. Money managers last week bought nearly 35k contracts of corn, flipping their net short position back around to long 21,500 contracts. I look for US plantings to have reached 4 – 5% in this afternoons crop progress report, up from 2% last week.
WHEAT
Wheat closed higher across the board in all 3 classes. KC continues to lead the way, up $.12. Chicago and MGEX were up $.02 – $.04. May-23 KC premium to Chicago made a new high today at $1.99 3/4 . The NWS 7 day precip. maps continue to offer very little moisture across the drought stricken Southern plains. Japan’s Ag Ministry is seeking 60k mt of feed grade wheat, tender to close Wed. April 12th. Export inspections at 12 mil. bu. were in line with expectations. YTD inspections at 632 mil. are down 3% from YA, in line with the USDA forecast. Last week MM’s bought nearly 3,000 Chicago wheat and 7,400 KC wheat. MM’s short position in Chicago is likely approaching 95k contracts. IKAR reports Black Sea wheat export prices at $273/mt late last week, unchanged from the previous week. SovEcon reports Russian grain exports last week were 1.1 mmt, with over 90% of the sales being wheat. I look for little change in the winter wheat crop ratings. Strong ratings in SRW areas, lousy in HRW areas. We may see our first planting progress for Spring wheat.
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