CORN HIGHLIGHTS:

• Despite strong selling in other grain markets, corn futures only saw moderate losses, supported by firm cash markets and zero deliveries against the May futures contract with the arrival of First Notice Day.
• The lack of deliveries may be reflective of the lack of farmers selling stored bushels. The cash basis market has been supportive of prices as producers have been more focused on planting the next crop versus marketing stored bushels. With more farmers out of fields this week due to wetness, the cash market may see more bushels moving in the days ahead.
• Corn planting is still running well ahead of schedule as producers pushed to get acres planted before last week’s rain. The corn crop was 27% planted, up 15% from last week. This is also trending 5% above the 5-year average and 4% above last year. Strong progress was noted in western and southern parts of the Corn Belt last week.
• The planting pace is expected to slow over the next couple weeks. Weather models are forecasting rounds of precipitation to push through the Corn Belt, which could limit planting until the middle of May.
• Reports of strong farmer selling in Brazil and Argentina have been limiting the corn market’s rally potential. The movement of corn in South America is making more bushels available to the export market, which could limit US near-term export demand.

SOYBEAN HIGHLIGHTS:

• Soybeans finished the day sharply lower due to big losses in soybean oil for the second consecutive day. This morning, there were 533 soybean deliveries reported against the May contract and 2,101 deliveries against May soybean oil. Soybean meal was lower today as well but not by as much as soybean oil which lost over 3% as it followed palm oil lower.
• Yesterday afternoon, the USDA released its Crop Progress report which showed that 18% of the soybean crop has been planted as of this past Sunday. This compares to 8% last week and the 5-year average of 10%. Progress was one point higher than the average trade guess.
• In the eastern part of the Corn Belt, continuous rains are causing some planting delays that are expected to last until May 18. In Argentina, continuous rains are falling as well, which is keeping farmers out of the field and unable to harvest soybeans which could lead to lower total production if yields are impacted.
• In South America, the Brazilian soybean harvest is estimated at 90% complete. Similar to Argentina, the southern region of Brazil is receiving too much rain and holding up harvest progress. Both southern Brazil and Argentina are expected to continue receiving rains throughout the week.

WHEAT HIGHLIGHTS:

• Wheat experienced a negative close across all three US futures classes, with KC contracts leading the way with double-digit losses. Additionally, lower Matif futures and a stronger US Dollar failed to offer any support, suggesting a risk-off session as numerous other commodities also closed lower. Equities mirrored this trend, with the Dow dropping over 400 points at the time of writing.
• From a technical perspective, all three US wheat classes are either at or near overbought levels, signaling a potential correction to the downside. In particular, daily stochastics indicate potential sell signals, suggesting further downward momentum. However, July Chicago wheat managed to find support at its 100-day moving average (596) and closed above that level.
• According to yesterday afternoon’s Crop Progress report from the USDA, winter wheat conditions fell by 1% to 49% rated good to excellent. Despite recent declines, conditions remain significantly better than a year ago and are the highest for this time of year since 2020. Additionally, 30% of the crop is now headed, marking an increase from 23% last year and 21% on average. The USDA also reported that 34% of the spring wheat crop is planted, a substantial jump from 10% a year ago and 19% on average.
• Two vessels containing Russian wheat destined for Egypt are reportedly being held up in port by the Russian government, despite passing inspection by Egyptian officials. This news follows the delay of two vessels in March and early April.
• Brazil’s wheat planted area may shrink this year after increasing by over 70% between 2019 and 2023. CONAB is anticipating a 4.7% drop in area compared to last season, citing uncertain weather, lower prices, and higher costs as contributing factors to the potential decline.

DAIRY HIGHLIGHTS:

• Class III futures were up anywhere from 10 to 48 cents on Tuesday with very solid volume overall.
• Spot cheese closed at its highest point since September 15th, 2023 at $1.80125/lb. The average jumped 4 cents today on a 8.25 cent jump in barrels and a quarter cent drop in blocks.
• Class IV futures saw just the May contract add a penny today while all others were unchanged. No volume was present.
• For Class IV spot products, powder closed a penny higher at $1.12/lb while butter was unchanged on no loads traded.

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Author

Amanda Brill