CORN HIGHLIGHTS: 

• The corn market saw follow through on Monday’s weak afternoon price action. Tuesday’s selling pressure was fueled by strong planting pace and demand concerns.
• Export demand remains a concern as USDA announced that China cancelled 272,000 mt (10.7 mb) of old crop sales this morning, adding to the bearish tone in the corn market. This makes the third cancellation of old crop purchases by China since April 24, totaling nearly 32.7 mb.
• As anticipated, planting progress was strong last week as producers planted 23% of the crop to reach 49% complete. This is 7% above the 5-year average. Keys stats of Iowa and Illinois have completed over 70% of his year’s plant projections.
• Weather forecasts look favorable overall for continued planting progress. Warm temperatures and moisture should only aid in germination, as the market is anticipating getting the crop off to a good start.
• The corn market and grain markets in general will be looking towards Friday’s USDA WASDE report for near-term direction and the market’s first look at 2023-24 marketing year supply/demand numbers. Expectations are for a slight increase in old crop carryout and new crop projected carryout to push 2.0 billion bushels for this fall. The report will be released on Friday, May 12 at 2:00 CST.

SOYBEAN HIGHLIGHTS:

• Soybeans finished the day significantly lower along with soybean meal and oil. Yesterday afternoon’s Planting Progress report showed soybeans ahead of pace, which pressured prices.
• Yesterday’s Planting Progress report shows total plantings at 36% complete which was above trade expectations and above the average of 21% for this time of year. 9% of the crop has emerged, which compares with 4% on average.
• Chinese soybean import pace was slower than expected last month, down 10% from the previous month. The Chinese economy may not be recovering as well as has been reported, which may slow their demand.
• Tomorrow morning the CPI data will be released, and traders will look for signs of inflation. The Federal Reserve has made comments that they will most likely not raise interest rates more this year, but will also not lower them this year even if there are signs of easing inflation.

WHEAT HIGHLIGHTS:

• The USDA rated the winter wheat crop at 29% good to excellent, which is up 1% from last week. Additionally, the poor to very poor rose 2% from last week to 44%, versus 39% last year.
• Only 24% of the US spring wheat crop is planted, which is behind the average pace of 38% and the lowest in 10 years.
• Matif wheat gapped lower in today’s trade and likely weighed on US futures.
• Negotiations on the Black Sea export corridor will take place between Russia, Turkey, Ukraine, and the UN over the next couple days. This could mean the deadline will be extended beyond May 18.
• Forecasts indicate that 3-5 inches of rain will likely fall in Texas and eastern Oklahoma and could be perceived as negative to prices.

DAIRY HIGHLIGHTS: 

• The second month Class III contract dropped 16 cents today to close at $16.88, the ninth close under $17.00 in the last 12 trading days on that chart.
• Spot cheese was unchanged today but remains near an 18-month low; the failure to garner buying enthusiasm after the push into the $1.50’s is concerning.
• The spot whey price is threatening to move under $0.30/lb for the first time since July 2020, closing at $0.3125/lb today.
• June Class IV futures also closed red, giving back 13 cents with only one contract traded on Tuesday.
• Spot butter has fallen a nickel through two trading days this week, falling back into the range it had held since late November.

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Author

Brandon Doherty