CORN HIGHLIGHTS:

• Corn futures ended mostly higher Wednesday, supported by seasonal strength and hints of a drier long-range forecast, though gains were capped by July weakness and bear spreading.
• While recent rainfall across the Corn Belt has pressured prices, some model runs now suggest a drier pattern for the Western Corn Belt into late June, encouraging short covering in December corn. However, long-range forecasts remain volatile and subject to change.
• USDA will release weekly export sales on Thursday morning, and expectations are for corn sales to remain supportive. For the week ending May 28, New corn sales are expected to range from 775,000-1.4 MMT. Last week’s sales were 916,500 MT.
• Ethanol production climbed to 1.105 million barrels per day last week, up from the previous week and last year. An estimated 107.2 million bushels of corn were used, in line with USDA’s pace for the marketing year.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day higher thanks to a drier extended forecast that may point to the start of a hot and dry summer. Soybean meal led the complex higher as soybean oil traded unchanged to slightly higher. President Trump’s upcoming discussion with China’s Xi may be supportive as well.
• Roughly 13.7 million soybean acres remain unplanted, ahead of the average pace based on March Prospective Plantings, thanks to favorable early weather.
• U.S. soybeans are now the cheapest option for smaller vessel shipments to Europe and North Africa for August–September, even undercutting northern Brazil after a sharp 25-cent basis increase there over the past two weeks.
• Market sentiment is finding some support from the White House’s continued optimism that President Trump and China’s President Xi will hold direct talks, offering hope for improved trade relations.

WHEAT HIGHLIGHTS:

• Wheat futures closed higher across all three classes, supported by a weaker U.S. dollar, strength in corn and soybeans, and gains in Paris milling wheat. Frost concerns in Argentina and optimism over upcoming U.S.-China trade talks added to the bullish tone.
• Heavy rains in the Southern Plains and Midwest are causing harvest delays and raising disease concerns due to localized flooding.
• Bearish pressure lingers from cheap Russian wheat, with FOB offers around $225/mt and a 25% cut to their wheat export duty, now at 1,023.5 Rubles/mt through June 10.
• Shaanxi and Henan provinces in China, which are both part of their wheat belt, continue to be impacted by hot and dry weather. And while those with irrigation systems have steady yields, some farmers claim that their harvest has been reduced by half. Official Chinese estimates are several weeks away, but the drought does appear to be having a significant impact from these anecdotal reports.

DAIRY HIGHLIGHTS:

• Class III futures faced selling pressure once again, but did manage to come off their lows. July ended up finishing down 33 cents at $18.89.
• Spot cheese was up slightly to $1.89/lb. Spot whey was unchanged today.
• Class IV futures were mixed but the nearby contracts were mostly higher. July and August were up 11 cents.
• Spot butter was up 6 cents on an impressive 25 loads traded. Volume has really picked up recently. Powder gave back a half cent.

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Author

John Heinberg