CORN HIGHLIGHTS:

• Corn futures extended their rally Wednesday, closing higher for the third consecutive day. A weaker U.S. dollar and broad-based strength across the grain complex contributed to the gains, reinforcing bullish momentum.
• Rain fell again over much of the Corn Belt on Wednesday, providing some key moisture in areas that have been in need of rain. While moisture is welcomed in the western Corn Belt, the eastern region remains too wet. With the calendar moving past optimal planting windows, the market is turning its attention to the final 20% of acres.
• Ethanol production rebounded to 305 million gallons last week, up from 292 MG and up 1.7% over last year.  A total of 103 mb was used in ethanol production last week, which is trending slightly below the USDA usage target for the marketing year.
• USDA will release weekly export sales on Thursday morning. For the week ending May 15, total new corn sales are expected to range from 700,000 – 1.6 MMT for old crop and 50,000 – 5000,000 MT for new crop. Last week’s old crop sales were 1.677 MMT, and toward the top end of expectation.
• The U.S. Dollar Index slipped to a two-week low, adding support to grain markets. Continued dollar weakness could provide further tailwinds for exports.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day higher for the third consecutive day breaking out of their previous three-day narrow trading range. Both soybean meal and oil traded higher which was supportive, but extended forecasts showing dry weather were likely the larger bullish factor supporting the entire grain complex.
• Brazilian soybean market saw it cash market premiums rise with strong buying activity by China. China is estimated to have bought 100 cargoes of soybeans in the month of May with the majority coming from Brazil, including purchase into new crop Brazil soybeans for next spring. The strong Chinese demand has lifted global soybean prices, helping support the global price of soybeans.
• While U.S. planting progress is ahead of average, recent widespread rains across the Corn Belt may temporarily delay fieldwork. Looking ahead, the 7–14-day forecast points to below-normal precipitation west of Ohio, raising early-season dryness concerns.
• In Argentina, there was severe flooding over the weekend with rainfall totaling 6 to 10 inches in some areas north of Buenos Aires. The 24/25 bean crop was estimated at 50 mmt previously and was 65% harvested last week. The catastrophic flooding will likely bring production lower.

WHEAT HIGHLIGHTS:

• Wheat futures closed higher for another session, fueled by continued short covering and supportive global cues. Chicago open interest fell by about 4,000 contracts, while speculative traders were estimated buyers of 8,000—indicating short liquidation. Paris milling wheat futures added to gains, breaking key moving average resistance despite a firmer Euro. A weaker U.S. Dollar also provided a lift to the U.S. wheat complex.
• China’s east-central growing region is forecast have scattered rains and cooler temperatures later this week, which should offer some relief from the recent heat, drought, and high winds. Nevertheless, some damage may have already been done, which could ultimately lead to increased Chinese wheat imports.
• Argentina announced an extension of its reduced wheat export tax rate (9.5%) through March 31, 2026. The move is intended to support competitiveness but does not apply to corn or soybeans, narrowing the export incentive gap.
• Traders will be keeping an eye on weather in the Black Sea region. Recent frosts in the Rostov region of Russia led to a declaration of a state of emergency, though it is worth noting that the affected area is only about 10% of the size of that which was impacted last year. Looking forward, the month of June is expected to be warm and dry in the Black Sea, which would also be unfavorable for the wheat crop. In related news, SovEcon is estimating Russian 2025 wheat production at 81 mmt, which is under both last year’s 82.6 mmt crop and the USDA’s estimate of 83 mmt.

DAIRY HIGHLIGHTS:

• The spot cheese block/barrel average added 3.125c on Wednesday, closing back up to $1.89875/lb. There were 2 loads traded.
• The Class III trade added plenty of premium to nearby months, with June milk limit up several times throughout the day. June finished up 68c to $19.63.
• The Class IV market still can’t get any momentum going. Both butter and powder were flat today on a lack of demand.
• After the market closed, the USDA reported April milk production was up 1.50% on 89,000 more dairy cows than a year ago.
• It should be noted that Class III futures trade well off the closing prices post close, reacting negatively to the milk production report.

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Author

John Heinberg