Written Commentary
CORN
Prices were $.02 – $.03 higher today with spreads holding steady. July-24 and Dec-24 have both made new highs for the week however remain well below their monthly highs at $4.75 ½ and $4.96 ¾ respectively. Forecasts for a wet Memorial Day weekend across the central Midwest threaten to extend the last 10-15% of this year’s corn plantings into early June. Some rain is expected to drift north into Parana, however little if any into MGDS further stressing Brazil’s 2nd corn crop. Export sales at 48 mil. bu. (36 mil. – 23/24 MY, 12 – 24/25) were in line with expectations. Old crop commitments at 1.940 bil. are up 30% from YA vs. the USDA forecast of up 29%. Shipments are up 27%. Noted buyers last week were Mexico – 14 mil. and Japan – 9 mil. There was also 11 mil. bu. sold and shipped to China that was switched from unknown. New crop commitments at only 103 mil. bu. are the lowest in 5 years. A South Korean feed mill reportedly bought 270k mt of SA or Southern African feed corn paying between $245 – $247/mt CF for Sept-24 shipment. The International Grain Council lowered their 2024/25 global corn production forecast by 6 mmt to 1.220 bil. mt, in line with the USDA est. US corn area in drought slipped another 2% to only 10%, vs. 26% YA.
SOYBEANS
Prices were lower across the complex with beans down $.02 – $.07 as spreads weakened, meal was steady to $1 lower, while oil closed near session lows down 60 – 70. Disappointing technical action in beans after July-24 posted a fresh 4 month high in early trade. The USDA didn’t announce any fresh sales to China despite rumors the past few days of some business off the PNW for summer shipment. July-24 meal briefly traded above LW high before pulling back. July-24 oil pulled back after not being able to make a new weekly high, closing into new lows for the week. More rain is expected for RGDS in Southern Brazil thru the weekend before a dryer trend develops into early June. Bean exports at 12 mil. bu. were at the low end of expectations. Old crop commitments at 1.576 bil. are down 16% from YA vs. the USDA forecast of down 15%. Shipments are down 18%. Still no new crop commitments to China. Total new crop commitments at only 35 mil. are the lowest since 2005. Soybean meal sales at 196k tons were below expectations. Old crop commitments are up 12% from YA, vs. the USDA forecast of up 8%. Soybean oil sales at 3k tons (-1k – 23/24, 4 – 24/25) were below expectations. Old crop commitments are up 5% from YA, vs. the USDA forecast of down 7%. US soybean area in drought slipped another 2% to only 7%, vs. 20% YA.
WHEAT
Prices jumped late closing near session highs across all 3 classes. KC and MGEX were the upside leaders closing $.09 – $.11 higher, while Chicago was up $.04 – $.05. July-24 Chicago wheat peaked this week at just over $2.50 premium to July corn, the highest in nearly 2 years. Little to no rain expected in the next week for the far WCB and SW plains. Southern Russia, eastern Ukraine and western Kazakhstan are expected to remain in a dry pattern thru the end of May, however prospects for rain improve in early June. Wheat exports at 9 mil. bu. (.7 mil. – 23/24 MY, 8 mil. – 24/25) were below expectations. Old crop commitments at 696 mil. are down steady with YA, vs. the USDA forecast of down 5%. Commitments represent 97% of the USDA forecast, in line with the historical average. Shipments are up 3%. The IGC lowered their 2024/25 global wheat production forecast by 3 mmt to 795 mmt, just below the USDA est. of 798 mmt. US winter wheat area in drought held steady at 25% vs. 47% YA. Spring wheat area in drought dropped another 11% to only 3% vs. 8% YA. Day 2 of the Illinois Wheat Association crop tour showed an average yield of 105 bpa, up from YA ave. at 97 bpa. The USDA’s initial forecast for IL in 2024 is 83 bpa, down slightly from YA record yield of 87 bpa.
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