TFM Morning Update 05-01-2023

CORN

Corn is trading slightly lower this morning under more bearish pressure from Brazil’s expected record safrinha corn crop which has good weather forecast for this week.
Chinese markets are closed for holiday but on Friday, July corn on the Dalian exchange posted a contract low as they expect large supplies from Brazil.
In the US, temperatures have been cool and the Midwest received some rain this weekend but the forecast going forward is warmer and drier which should get the planters rolling in bigger numbers.
Last week’s CFTC data showed what everyone was anticipating which was funds taking a net short position in corn. They sold 64,731 contracts bringing them to a net short position of 15,297 contracts.

Soybeans are trading higher this morning and appear to be continuing the reversal seen on Friday. Tight on-hand supplies may be supporting the soy complex.
Soybean meal is slightly higher while soybean oil is lower as crude oil falls by over 1.50 a barrel to 75 dollars a barrel.
Brazil’s record harvest may be priced in for the moment after Brazilian farmers sold everything they could not store and now hold everything they can causing prices there to rise.
Friday’s CFTC data as of April 25 showed funds as sellers of 47,574 contracts reducing their net long position to 87,208 contracts.

Wheat is trading lower again and is now the lowest it’s been since July of 2021. Improving winter wheat crop ratings following last week’s rains add to the pressure.
European officials made a deal with five eastern European countries which allows them to ban imports of Ukrainian grain as long as they allow grain to pass through the rest of Europe.
Russia is looking unlikely so far to extend the Black Sea grain deal on May 18 unless their demands are met, and the missile attacks on Ukraine continue. If grain shipments slow out of the Black Sea, it could be supportive for US prices.
Friday’s CFTC data showed funds adding to their net short position. They sold 10,029 contracts increasing their net short position to 113,012 contracts.

Amanda Brill