Corn is trading higher again today and is on track for the third consecutive close. There has been no real bullish fundamental news, so the rally seems technical and seasonal.
Trade is focused on the financial situation regarding the debt ceiling and when an agreement will be reached. This has negatively affected the equity markets and the deadline is this Friday.
China has been purchasing more wheat and less corn and has been sourcing primarily from Australia. This adds concerns to more sales cancellations.
Both the northern and southern Plains are forecast to receive rains which are much needed, but dryness is still expected for the heart of the Corn Belt in the short term.
Soybeans began the day lower, but are trading higher now, along with soybean meal and oil. A jump in crude oil by over a dollar a barrel has been supportive.
Commercial crude inventories fell by 12.5 million barrels for the week ending May 19. This comes as Saudi Arabia is signaling that production cuts may be incoming, driving up crude prices and helping the soy complex.
July soybean meal is making new lows as Brazil exports soybeans into Argentina, so that they can offset their crush facilities form their poor crop.
Soymeal has been under pressure with China saying they will use less soymeal and corn for feed and more wheat, and soybean oil has found no support from palm oil, which continues to fall.
Wheat is trading lower today after a pop yesterday caused by headlines that Russia was blocking ship traffic to Ukraine’s largest port and is slowing other traffic in the Black Sea.
Chinese wheat imports for the first four months of the year are 6 mmt, which is up 61% from a year ago, with the primary seller being Australia. This comes as China looks to utilize more wheat instead of corn and soy for feed.
There have been reports of wheat being imported into the US from Europe to take advantage of the cheaper prices, which has added to bearish sentiment.
Rain continues to fall in North Dakota and the northern Plains, which is delaying plantings, and rains in the southern Plains threaten wheat quality in early harvest.
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