Written Commentary
SOYBEANS
The soybean complex was lower across the board with soybeans down $.07 – $.11, soybean meal down $2 – $3, while soybean oil was down 50 – 65. May-23 soybeans violated support at both its 50 and 100 day MA’s intraday, however recovered to close right at its 100 day MA at $14.97 ½. Next support is the monthly low at $14.82 ½. Soybean exports at only 4 mil. bu. were below expectations. YTD commitments are now down 12% from YA, vs. the USDA forecast of down 7%. Shipments however are still up 1%. Outstanding sales to China/unknown sit at only 75 mil. bu., well below the 245 mil. from YA. With US soybeans roughly $90/mt above Brazilian supplies and US sales starting to slip vs. YA. it’s becoming more difficult to support the current USDA export forecast of 2.015 bil. bu. Soybean meal sales at 145k tons were also below expectations. Spot board crush margins slid another $.04 to $.94 bu., its lowest level since June-22.
CORN
Prices closed $.05 – $.10 lower. May-23 made a new low for the week. Next support levels are the 100 and 50 day MA’s at $6.57 ¼ and $6.50 ¼ respectively. Lower wheat prices, weak demand and speculative selling all weighed on corn values. Despite the weakness the May-23 spread over July made a new high today at $.40 over. This same spread peaked last year at $.45 in early Mch-22, shortly after the Russian invasion of Ukraine. Since China’s purchases of just over 700k tons of US corn last week, export news has been nonexistent. Today’s weekly sales report showed a combined 29 mil. bu. of old and new crop sales last week, well below expectations. Old crop commitments are down 33% from YA, vs. the USDA forecast of down 25%. Offsetting the Chinese purchases last week were cancellations to both Mexico and unknown. The 1.3 mil. acre expansion combined in ND, SD, and MN could be in jeopardy if the much below normal temperature forecasts last deeper into May. Under that scenario prevent plant would start to look much more attractive.
WHEAT
Prices were down $.11 – $.14 in Chicago and MGEX, while KC was down $.21 – $.23. Spot KC contracts have slipped to their lowest levels in a month. So far May-23 MGEX has held support above last week’s low at $8.46 ½. The updated NWS 7 day precipitation maps shows the entire state of Kansas receiving .75”+ rain. Roughly 80% of Kansas and nearly all of Oklahoma expected to received 1.5”+. While confidence is increasing, the rains haven’t fallen yet, at least in the most drought stressed areas. Export sales at 12 mil. bu. were in line with expectations. Old crop commitments are down 4% from YA, vs. the USDA forecast of down 3%.
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