CORN HIGHLIGHTS:

• Carryover strength from sharply higher wheat, with additional support from soybeans, helped push both July and December corn higher in today’s session after holding support above last Friday’s lows. While December held above its 100-day moving average on Friday, July corn traded and closed back above its 100-day ma today.
• Weekly corn export inspections came in strong and above the range of expectations at 48 mb. To date, 1.386 billion bushels of corn have been inspected for export, which is 29% above year-ago levels and on pace to meet the USDA’s export forecast. Of the total inspected, 11 mb are destined for China.
• Friday the CFTC issued its Commitment of Traders report showing that Managed funds net bought just over 31,000 contracts, which reduced their position to the smallest net short since last August, just over 71k contracts.
• This afternoon, the USDA will issue its weekly Crop Progress report, and corn planting is estimated to be about 73 – 76% complete. It is expected that there could be between 10 – 12 million acres planted after May 20, increasing the risk of pollination in hotter and drier conditions.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day higher along with both soybean meal and oil. Soybean oil was the leader with a gain of 2.32% in the July contract while soybean meal was up 1.44%. Support continues to come from wet conditions that are delaying planting, but wheat was up sharply today and likely lent support to corn and soybeans as well.
• This morning, the Chinese import data from April was released and showed that the country imported a total of 5.92 mmt of soybeans from Brazil in April which was the highest number since September. Imports from the US in April totaled 2.45 mmt which was up 12% compared to March and up 23% from April of last year.
• Today’s Export Inspections report showed soybean inspections totaling 6.8 mb for the week ending May 16, and total inspections are now at 1.461 billion bushels for 23/24 which is down 18% from the previous year. The USDA is estimating soybean exports at 1.700 billion bushels for 23/24 which is down 15% from the previous year.
• In Brazil, the soybean harvest in Rio Grande do Sul is estimated at 78 to 85% complete but the region is still dealing with moisture from the flooding. Argentina is estimated to be 64% completed with harvest, and last week the US was on track with its 5-year average planting pace and likely will be again in today’s Crop Progress report.

WHEAT HIGHLIGHTS:

• Wheat finished the session with sharp gains across the board. Paris milling wheat futures added support to a sharply higher close, with the December contract leading the way with a gain of 10 Euros. This puts it within 1.50 Euros of last week’s high – a level not seen since July of last year.
• Strength in the market could be attributed to growing concerns about the Russian and Ukrainian wheat crops following recent frosts and ongoing dryness. Additionally, there may be some additional war premium factored in, especially after Ukraine’s attack on Russian grain infrastructure at the port of Novorossiysk.
• Weekly wheat export inspections reached 7.6 mb, bringing total 23/24 inspections to 657 mb. However, inspections are trailing behind the pace needed to meet the USDA’s goal, with total inspections down 7% from last year, whereas the USDA aims for a 5% decline.
• According to IKAR, Russian wheat FOB values rose to $239 per mt last week, compared to $221 the previous week. Moreover, recent freezing conditions may have damaged up to 900,000 hectares of grain. APK-Inform projected a 20-30% yield drop in wheat and other spring crops, adding to concerns.
• StoneX estimates project that western Australia’s wheat crop may decrease to 4.5 mmt, significantly lower than the typical 10 mmt crop. However, Australia’s total production outlook remains positive, with expectations of an 11% increase to 29.3 mmt.

DAIRY HIGHLIGHTS:

• June Class III futures traded to a new high of $21.82 this morning but fell off to $21.23 at the close, down 23 cents from Friday’s finish.
• Spot cheese fell 1.8750 cents to $2.0150/lb with both blocks and barrels down. The spread now sits at a 19 cent premium of barrels over blocks.
• Class IV futures were mixed on the day with the second month June contract up a penny to $21.11, 12 cents under its Class III counterpart.
• Spot butter hit a new 6-month high at $3.0925/lb today while powder was down a half cent.
• US Milk Production was down 0.40% for all 50 states in the month of April. Cow numbers were lower once again but production per cow was higher YoY.

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Author

Brandon Doherty