Written Commentary
CORN
Prices were mixed from up $.03 in spot May to down $.03 for new crop. Spreads firmed. Improved conditions in Brazil along with expectations for US corn acres to jump 3-4 mil. this year seem to be outweighing good demand for US corn. Speculative traders continue to shed length having been net sellers 4 of the past 5 sessions before today with their long position back down roughly 115k contracts. Weather in Mato Grosso, which accounts for nearly half of Brazil’s 2nd corn crop, remains nearly ideal with a good mix of rain and sunshine. Rains have been a bit more scattered in the SC region. Ethanol production jumped to 1,105 tbd, or 325 mil. gallons, up from 312 mil. the previous week and up 5.6% from YA. Production was above expectations. There was 111 mil. bu. used in the production process, or 15.8 mil. bu. per day, well above the 14.85 needed to reach the USDA forecast of 5.50 bil. bu. Despite the higher than expected production, ethanol stocks slipped to 26.6 mil. barrels. This was below expectations however still above the 26 mb from YA. Implied gasoline usage fell 4% LW to 8.817 tbd, however was in line with YA. Export sales tomorrow are expected to range from 35-65 mil. bu.
SOYBEANS
Prices were lower across the complex with beans down $.04-$.06, meal was $2-$3 lower, while oil was steady to down 15 points. Spreads strengthened in beans and meal while weakening in oil. New low for the week in May-25 beans with next support at LW’s low at $9.94. New 2 week low for May-25 meal with next support at the March low at $291.30. Inside trade for May-25 oil as prices retreat a bit after 3 consecutive higher closes. Spot board crush margins slipped $.02 ½ to $1.12 ½ while bean oil PV inched up to 41.6%. Weather in SA remains favorable as rains and cooler temperatures return to key growing areas of Argentina. This following nearly 2 weeks of dry conditions. In Brazil, dryness in the deep south in RGDS has been favorable for soybean harvest, however follow up rains are needed to improve the quality of their 2nd corn. Improved Brazilian basis along with expectations for US acres to slip 3-4 mil. in 2025 has been able to support spot prices above $10 despite deteriorating US/Chinese trade relations. Abiove lowered their Brazilian production forecast another .8 mmt to 170.9 mmt, getting closer to the USDA at 169 and Conab at 167.4 mmt. Abiove kept their crush est. at 57.5 mmt and exports at 106.1 vs. the USDA at 56 mmt and 105.5 mmt respectively.
WHEAT
Prices ranged from $.02-$.11 lower across the 3 classes today with KC futures the downside leader. Despite the weakness May-25 KC held above its low for the week at $5.91. A major winter storm is working its way thru the nation’s midsection today. A heavy but narrow band of snow (some areas up to 6-12”) is expected from E. NE cutting northeast thru IA, SC MN and into centra WI. Ahead of the snow, good rain and possible thunderstorms for S. WI and N. IL. Radar showed snow showers covering a large portion of central KS, however water equivalent will likely not be high. Above normal temperatures are expected to hold across the southern plains into month end while precipitation in week 2 appears normal. The recent S&P Global update lowered their all wheat acres forecast 500k from January to 46.6 mil. acres which was still 536k above YA. Their winter wheat forecast at 34.115 mil. in line with the USDA. A survey est. from Allendale placed all US wheat acres at 45.863 mil.
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