New crop corn rallies once again

May corn futures added 33-3/4 cents this week to close at 7.68-3/4. New crop December corn futures added 27 cents this week to close at 715. The USDA left its old-crop corn ending stocks unchanged at 1.44 billion bushels in today’s Supply and Demand report. Brazil’s corn crop size was increased 2 million tons to come in at 116 million tons. Overall world ending stocks for corn came in at 305.46 million tons, up from 300.1 million tons in March. Much of this increase, however, came from a decrease in export projections out of Ukraine. Today’s USDA numbers were much in line with expectations even if market reaction post report seemed to signal otherwise.

Front month corn futures have remained mostly sideways over the last month trading between 770 and 720. New crop corn futures in the same time frame have rallied nearly 70 cents. The inverse from old crop to new crop that traded over 150 cents in early March closed today at just 53 cents. It would be logical to see this inverse continue to shrink as the most uncertainty is held in the new crop ready to be planted in the coming weeks.

Soybeans battle back

May soybean futures added 106-1/4 cents this week to close at 1689. New crop November soybean futures added 88 cents this week to close at 1495. The USDA lowered old-crop soybean ending stocks by 25 million bushels to come in at 260 million bushels in today’s Supply and Demand report. Old crop ending stocks in April of 2021 came in at a nearly identical 257 million bushels. Brazil’s soybean crop was reduced 2 million tons to come in at 125 million tons. World soybean ending stocks are now estimated at 89.58 million tons, this is down 0.38 million tons from the March estimate.

The weekly export sales report showed that for the week ending March 31, net soybean sales came in at 800,746 tons for the current marketing year and 298,500 for the next marketing year for a total of 1,099,246, which was about as expected. Increased exports in today’s Supply and Demand report was as expected as export sales were nearing the USDA’s previous estimated with five months still remaining in the marketing year.

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Wheat sideways this week

May CBOT wheat futures added 67 cents this week to close at 1051-1/2. May KC wheat futures added 93-3/4 cents this week to close at 1106-3/4. May spring wheat futures added 62 cents this week to close at 1127-1/4. The USDA raised its old crop wheat ending stocks by 25 million bushels from last month’s estimate to come in at 678 million bushels. Exports were cut by 15 million bushels and feed use was raised by 10 million bushels. Nearly half of winter wheat production in the US remains in some sort of drought category as the crop continues to come out of winter dormancy. The winter wheat crop was rated just 30% good to excellent as of last week Sunday. Monday afternoon will bring an updated crop rating, but the next two weeks look dry for much of this region.

Milk Ends Week Modestly Higher

Class III futures closed the week with gains as the second month May contract finished Friday at $24.85, up 23 cents overall. The reaction to the losses from the end of March has been positive with a nice snap back to the topside, and credit is largely due to the higher feed prices and a push to multi-year highs in cheese. The block/barrel average finished the week 7.00 cents higher at $2.34375/lb, its highest level since November 2020 as the market was able to breach the 2019 peak. Spot whey also posted its second higher weekly close within the last nine, pushing 2.50 cents higher with a close at $0.6350/lb. Class III prices and the 2022 calendar year average are positioned just beneath the highs from a few weeks ago while the second month chart still sits beneath the 2014 apex, making for what could be an interesting upcoming week.