CORN HIGHLIGHTS: 

• The corn market saw choppy, pressured trade overall to start the week, with support staying in the old crop due to potential tighter supplies helping support the front end of the market. The lack of deliveries against the May futures reflects this tighter old crop corn supply picture.
• Strong selling pressure in the wheat markets limited the potential gains in the corn futures market as wheat futures broke to new nearby lows to start the week.
• Weather forecasts are turning more favorable for improved planting pace, as recent cold temperatures likely limited planting in the north and northwestern corn belt this past week.
• Money flow is a concern in the corn markets as managed money funds moved back to a net short position in the corn markets of 15,297 short contracts, selling over 64,000 net corn positions last week.
• Weekly export inspections for corn were strong this week at 1.518 MMT, which was a market-year high. Despite the strong shipment week, export inspections are still down 35% year-over-year.

SOYBEAN HIGHLIGHTS:

• Soybeans kept their momentum from Friday and moved higher again today with support from both soybean meal and oil.
• While lower crude oil pressured soybean oil earlier in the day, bean oil recovered to close on the positive side of unchanged.
• Basis for Brazilian soybeans appears to have put in a bottom and has rallied between 30 and 50 cents in the last week. Farmers initially sold everything they could not store but are now holding onto what they can to avoid making sales below their cost of production.
• Argentina’s soy-dollar incentive to get farmers to make cash sales has not worked nearly as well as it did the two previous times and has resulted in sales of just 2 mmt. Argentinian farmers are keen to hold on to their old crop due to the drought which significantly cut into production.
• Soybean inspections were on the lighter side last week with 14.8 mb inspected for export. Total inspections are now at 1,744 mb and are even with the previous year. The USDA is estimating soybean exports at 1.990 bb for 22/23, which is down 8% from the previous year.

WHEAT HIGHLIGHTS:

• The managed funds are said to have sold 146,000 grain contracts in total last week. With all three US wheat classes posting double-digit losses, it is likely that they continued to add to shorts today.
• Spring wheat planting conditions should improve mid to late week, with temperatures in the Dakotas expected to reach the 70s.
• The EU struck a deal with several eastern European countries: Five nations will ban imports of Ukrainian grain to maintain profitability for their farmers, but they will allow the grain to be transported westward to other countries through their regions.
• At this point in time, it does not seem like Russia intends to renew the Black Sea Grain Initiative. The current deal is set to expire on May 18.
• Wheat inspections of 13.2 mb for the week bring total 22/23 inspections to 671 mb. That is down 3% from last year.

DAIRY HIGHLIGHTS: 

• May Class III futures dropped 22 cents today to $16.60, matching last Tuesday’s low close and erasing Thursday’s gains.
• Spot cheese dropped 1.50 cents today after rallying more than a dime in Thursday and Friday’s action.
• The premium in cheddar blocks over cheddar barrels closed at 11.75 cents today, down from 26.25 cents on April 14.
• Class IV action was quiet with some small gains in futures; spot butter was unchanged as powder dropped 1.75 cents.
• The first of two Global Dairy Trade Auctions for the month will take place tomorrow morning.

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Author

John Heinberg