TFM Midday Update 4-3-2024

CORN

Corn is trading slightly higher at midday and is back near its levels from before Thursday’s bullish USDA report. Pressure has come from recent rains across the Midwest which have improved soil moisture levels, and concerns about avian flu in cattle and what that could mean for feed demand.
China is reportedly encouraging its traders to slow their arrivals of foreign corn imports in an effort to bolster domestic prices, which are at three-year lows, as China’s own farmers prepare to plant.
Later today, the EIA will release their weekly petroleum status report which will include ethanol production and stocks from last week. Production is expected to be lower than the previous week at 1.046m b/d with stockpiles at 26.166m bbl, which would be the highest stocks levels since March of last year.

Soybeans are mixed near midday with the front months trading slightly lower but new crop slightly higher. May soybeans have had 5 consecutively lower closes and is on track for a sixth. Soybean meal is lower, but soybean oil is continuing its trend higher with support from palm oil.
Biodiesel margins are reportedly as much as $1.10 higher per gallon than last year with increased demand and more plants opening. This has been a driver of good demand for soybean oil.
With exports sluggish lately, and South America harvesting their soybean crop and taking most of the export business, there has been little in the way of bullish fundamentals, especially with US soybean planting intentions assumed to be higher this year. Soybean oil has been the main factor supporting soybeans.

All three wheat classes are significantly higher at midday with Minneapolis and KC wheat leading the way up and lending some support to corn. The near-term forecast is drier for the Plains, and increased tensions in the Black Sea region are also adding support.
India is expected to import wheat in the 24/25 marketing year despite expectations of a record harvest. This is due to a decline in government stockpiles and low prices globally. This would be the first time that India imported wheat since 2017.
Yesterday, Reuters reported that a Ukrainian drone attacked a Russian oil refinery, but the extent of the damage was not revealed. Despite the conflict in the region, Ukraine managed to export 14 mmt of wheat in the July to June marketing period.

Amanda Brill