CORN HIGHLIGHTS:

• Corn futures finished higher on the session as late buying strength in soybeans and positive demand news helped lift corn futures in a relatively quiet day. May corn gained 2 ¾ cents on the session. For the week, May corn futures ended 3 cents lower.
• USDA reported a flash export sale of corn this morning.  Unknown destinations bought 4.8 mb (125,000 mt) for the 23/24 marketing year. That was the second published sale of corn this week as US corn represents good value in the export market.
• Improved weather forecast has put selling pressure back into the Brazil corn market. Weather may look more questionable as the calendar turns into April, but weakening corn prices in Brazil may limit rally potential for US corn.
• The Argentina corn crop remains in good condition, but ratings slipped slightly last week.  Currently 25% of the Argentina crop is rated good to excellent, and 17% poor to very poor.  Argentina is forecasted to produce a record corn crop this growing season after the past 2 years of drought.
• Managed funds are still holding a large short position in the corn market.  Last week, Managed funds were still net short 296,795 contracts. Expectations are that the funds have covered some short corn positions given the recent price strength. The next Commitment of Traders report will be released on Friday afternoon.

SOYBEAN HIGHLIGHTS:

• Soybeans closed higher today after another day of volatility which saw May futures down as much as 12 cents at one point before recovering into the end of the day. Yesterday, May futures were up as much as 20 cents before selling off for a loss on the day. May ended the day just below the 50-day moving average at 1198 ½.
• For the week, May futures gained 14 ¼ cents, May soybean meal lost $6.70, and May soybean oil gained 3.25 cents, a big move thanks to contract highs in palm oil. The palm oil market has rallied sharply this week which has benefited soybean oil and other edible oils and was likely the main driver in soybeans this week.
• The NOPA crush report was released today and showed 186.194 mb of soybeans crushed in February. This was above the average trade guess of 178 mb, was a record for February, and 12.6% above the previous year. Soybean oil stocks came in at 1.69 billion pounds, which was above the average trade guess, but also the lowest in 9 years for the month.
• In Argentina, the states of Cordoba and Buenos Aires are receiving significant rain which has greatly improved soil moisture in the growing regions, in addition, the Argentine government is rumored to be planning a fifth round of the soy dollar program to encourage farmer selling.

WHEAT HIGHLIGHTS:

• Wheat had another down day for the third consecutive session. Talk that China cancelled US wheat sales, may have cancelled French sales, and either cancelled or rolled forward up to 1 mmt of Australian sales continued to weigh on the market. Light bear spreading was noted in Chicago futures, where there was greater selling pressure in the front months versus the deferred and could be a result of the recent cancellations as well.
• In addition to the cancelled sales, yesterday’s negative PPI data showed inflation higher than anticipated. This had the US Dollar Index up sharply yesterday and marginally again today, keeping pressure on wheat futures. This may also indicate that the Federal Reserve will be slower to cut interest rates, which may have longer term implications on the direction of the US Dollar and therefore, wheat prices.
• On a bullish note, the EU soft wheat production estimate for the 24/25 season was reduced 1 mmt from last month, now at 121.6 mmt, according to Strategie Grains. In addition, the French wheat crop is rated the poorest in four years, 66% good to excellent. France struggled with heavy rain and snow during their planting season that caused an acreage reduction, with current weather also to blame for the declining condition.
• The International Grains Council has projected higher grain stocks for the 24/25 season at 601 mmt. At the end of this season, stocks are expected to be 599 mmt. Additionally, the total 24/25 grain production is forecasted at 2.33 billion mt, up 1% from the 23/24 estimate.
• According to the USDA, the areas of US winter and spring wheat in drought as of March 12 are unchanged from the previous week. About 14% of winter wheat and about 30% of spring wheat areas are said to be experiencing drought conditions.

DAIRY HIGHLIGHTS:

• An early week rally in milk futures was short lived as the market gave back most of the gains by week’s end.
• The market had rallied from a report that dairy cattle in the Texas panhandle were having respiratory issues. There remains a lot of unknowns with this story which could be why the market has given back most of the gains.
• In Friday’s dairy spot trade, butter fell 2.50c, cheese added 0.375c, and whey was up a half cent. There were a total of 7 loads of cheese traded.
• For the week, 2nd month Class III fell 7c to $16.01 while 2nd month Class IV gained 20c to a $20.00 even close.
• Events next week for dairy include a Global Dairy Trade auction on Tuesday, a milk production report on Wednesday, and a Cold Storage report on the following Monday, the 25th.

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Author

Brandon Doherty