CORN HIGHLIGHTS:

• Corn futures extended losses for a second session Thursday, with July leading the decline. Prices bounced off session lows, supported by fresh export sales and strength in other grain markets.
• Trading volume was the lightest of the week, suggesting selling pressure may be easing. July corn is down 12 ½ cents so far this week heading into Friday.
• USDA announced two flash sales Thursday: 104,000 MT to Mexico and 101,096 MT to Unknown for 2024-25 delivery. Weekly export sales for the week ending May 22 will be released on Friday.
• Weekly ethanol production climbed higher again this week up to 310.5 mil. gallons, up from 305 mil. the previous week. This total was down 1% from last year. A total of 105 mb of corn was used in production last week but has slipped behind the pace needed to reach the USDA target for the marketing year.
• Weather will stay as the driver in the corn market in the near-term as forecasts moving into early June look friendly for crop development.

SOYBEAN HIGHLIGHTS:

• Soybeans were mixed to end the day with the new crop contracts finishing higher while new crop was slightly lower. This came after a day of volatile trade, which saw July soybeans fall below the major moving averages to as much as 8 cents lower as weather forecasts improve. Soybean meal was higher while bean oil ended the day lower.
• A U.S. trade court ruling late Wednesday deemed former President Trump’s China tariffs unlawful, raising speculation that soybean-related tariffs could be lifted—potentially boosting U.S. export prospects this fall, despite China’s current reliance on Brazilian supplies.
• At this time, funds are estimated to hold a net long position in soybeans of around 10,000 contracts and are estimated to have a long position in soybean oil around 59,000 contracts. In soybean meal, however, they hold a net short position of over 100,000 contracts, which is a record short position and could trigger short covering at some point.
• In Argentina, the recent rains and severe flooding near Buenos Aires will likely impact the country’s total production. One prominent South American crop scout has lowered their estimate by 1.6 mmt for total production of 48.5 mmt. In Brazil, soybean production is estimated near 170 mmt.

WHEAT HIGHLIGHTS:

• All three wheat classes ended higher Thursday, led by Minneapolis futures, which posted double-digit gains for a second session. Support came from the spring wheat crop’s lower-than-expected 45% good/excellent rating, a bearish reversal in the U.S. Dollar Index, and strength in Paris milling wheat (Matif), which also saw a bullish reversal and positive close.
• USDA data as of May 27 shows 16% of U.S. winter wheat acreage remains under drought conditions—down 5% from last week—likely reflecting recent rainfall in Kansas. However, spring wheat areas in drought held steady at 29%, a sharp contrast to just 3% a year ago, helping to fuel strength in Minneapolis prices.
• According to the USDA, as of May 27, an estimated 16% of US winter wheat acreage is experiencing drought conditions. This is down 5% from last week and may largely be attributed to recent rains in Kansas. Spring wheat production areas in drought held steady, however, at 29% during the same timeframe. This is far above the 3% reading from a year ago, which may help to explain the boost today in Minneapolis prices. The European Commission has revised their estimate of EU 25/26 grain production from 280.3 mmt to 279.6 mmt. However, this was largely due to decreases in their corn estimate. In fact, their soft wheat harvest projection was raised by 0.3 mmt to 126.6 mmt.
• LSEG cut its forecast for Canadian wheat output to 35.3 MMT, down 3% from its previous estimate, citing persistent dryness across the southern Prairies, especially in Saskatchewan and Manitoba. For comparison, USDA’s latest estimate stands slightly higher at 36 MMT.

DAIRY HIGHLIGHTS:

• NO DAIRY UPDATE TODAY

Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of the National Futures Association. Stewart-Peterson Inc. is a publishing company. SP Risk Services LLC is an insurance agency. A customer may have relationships with all three companies. TFM Market Updates is a service of Stewart-Peterson Inc. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.

Author

Brandon Doherty