Written Commentary
CORN
Prices closed steady to $.03 lower today with spreads firming on lack of deliveries. July-24 bounced off support at its 50 day MA of $4.45. Next support is this month’s low at $4.35 ¾. Dec-24 also bounced of its 50 day MA. Heaviest rains this week will again favor the central corn belt, slowing down planting efforts however helping alleviate drought conditions. Better planting opportunities for the far WCB and ECB. US planting progress advanced to 27% complete as of Sunday, ahead of 23% YA and 5-year Ave. of 22%. 7% of the crop has emerged, also slightly above recent history. IA advanced 26% to 39% complete, MN 22% to 30%, while MO advanced 16% to 63% done, all well above their respective averages. In the east IN at 8%, OH 6% and PA at 2% all at or below average. Late yesterday Datagro raised their Brazilian corn production forecast nearly 1 mmt to 115.8 mmt, below the USDA est. of 124 mmt however larger than Conab’s forecast of 111 mmt. Dr. Michael Cordonnier lowered his Argentine est. 1 mmt to 49 mmt, just below USDA and BAGE. As of this writing still no announcement from the USDA or EPA on corn ethanol usage for SAF production. Tomorrow’s EIA report is expected to show ethanol production between 933 – 979 tbd vs. 954 tbd the previous week.
SOYBEANS
The soybean complex was lower across the board with beans down $.15 – $.20, meal was $2 – $3 lower, while oil was down 110 – 140. A rebound attempt overnight for July-24 beans stalled right at its 50 day MA. After violating support at LW’s low of $11.59 ¾ July-24 did rebound a touch into the close. July-24 meal surged thru its 100 day MA resistance overnight, carving out a 3 month high before being drug lower by beans and oil. Meal found support from day 2 of an Argentine port strike along with no deliveries. Spot oil plunged to its lowest level since Jan-2021 initiated by deliveries exceeding 2,100 contracts. Biodiesel and renewable diesel production in Feb-24 fell 2 mil. gallons to 388 mil. gallons, however average daily production increased by nearly 1 mil. gallons given the fewer number of days. Annualized industry capacity for biodiesel and RD fell another 89 mil. gallons to 5.841 bil. gallons due to reduced biodiesel capacity. Combined industry capacity is down 1.6% from its peak in late 2023. Bean oil usage for biofuel production at only 888 mil. lbs was down 7.5% from Jan-24 and down 2.4% from Feb-23. This was the lowest usage figure since Dec-22. Total BO usage in the first 5 months of the 23/24 MY has reached 5.113 bil. lbs., still up 11.5% from YA vs. the USDA forecast of up 4%. BO usage as a feedstock fell to a new low just under 31%. No forecast change in Brazil. Heavy rains continue to delay the remaining soybean harvest in RGDS. Little to no rain across the central and northern growing regions as their 2nd corn crop advances toward maturity. Southern growing regions of Argentina have a risk of frost late this week, better chances next week. Datagro raised their Brazilian production forecast 1.6 mmt to 147.9 mmt, below the USDA’s 155 mmt est. however above Conab at 146.5 mmt. Soybean planting progress at 18% vs. 16% YA and 5-year Ave. of 10%. Progress was in line with expectations.
WHEAT
Prices were lower across all 3 classes with Chicago and MGEX down $.04 – $.07 while KC was $.15 – $.20 lower. Despite the weakness July-24 Chicago bounced off its 100 day MA support at $5.96. Next support for July-24 KC is $6.27. Spreads made new lows in Chicago. US winter wheat conditions fell 1% to 49% G/E. Declines were mostly seen in HRW producing states with increases in SRW producing areas. CO and KS both fell 5%. Despite the decline, overall ratings are the highest since 2020. Spring wheat plantings advanced 19% to 34% complete, vs. only 10 % YA and 5-year Ave. of 19%. Jordan passed on their recent tender for 120k mt of wheat, citing prices being too high. Reports are circulating that 2 more vessels of Russian wheat destined for Egypt are being held up by the Russian Govt. despite passing inspection by Egyptian officials.
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