TFM Daily Market Summary 05-10-2024

CORN HIGHLIGHTS:

  • Corn futures finished near the highs for the week supported by a neutral to friendly WASDE report, and strong buying in the wheat markets. For the week, July corn gained 9 ½ cents and posted its highest weekly close since the second week in January.
  • Friday’s USDA Supply/Demand report posted friendly numbers for old crop corn according to expectations. The USDA added 50 mb of demand to both ethanol production and exports to lower carryout to 2.022 billion bushels. This was 100 mb below expectations, supporting old crop prices.
  • The USDA released initial projections for the 24/25 marketing year. As expected, planted acres for the next crop year was 90 million acres with trend line yield of 181 bushels/acre. After minor demand adjustments, year over year new crop carryout is projected at 2.102 billion bushels. This was below market expectations, but still reflects a relatively heavy corn supply for the next marketing year.
  • The USDA projections for South American corn production saw mild reductions from the April report. The USDA lowered Argentine corn production to 53 mmt and Brazil production to 124 mmt, each down 2 mmt from the April report, but still ahead of analyst estimates from those regions.
  • The market will shift its focus back to planting weather. Recent rainfalls have limited planting progress, but longer-range forecasts are turning drier overall. Crop progress numbers on Monday afternoon may be key for near-term market moves. Last week, corn planting was 36% complete nationally.

SOYBEAN HIGHLIGHTS:

  • Soybeans ended the day higher following the USDA’s WASDE report which was relatively neutral for soybeans. The support today came from soybean oil which rallied sharply over 4% as a result of import duties on cooking oils potentially being raised significantly. Soybean meal ended the day lower, and July soybeans are trading back above the 100-day moving average.
  • Today’s WASDE report said that old crop ending stock estimates for soybeans were unchanged at 340 mb and the first projection for 24/25 production was posted at 4,450 million bushels which was slightly higher than the average trade guess. New crop ending stocks were pegged at 445 mb which was above the average trade guess. Brazilian soybean production was revised lower by 1 mmt to 154 mmt and Argentinian production was surprisingly unchanged at 50 mmt.
  • For the week, July soybeans gained 4 cents but are down 37 cents from the Tuesday highs. November soybeans ended the week up 4 ¾ at 1205 ¾, July soybean meal lost just $0.30 at $371.90, and July soybean oil gained 1.36 cents to 44.44 cents. Funds were likely net buyers of soybeans this week after being spurred by planting delays and South American weather issues.
  • The extreme flooding in Rio Grande do Sul, Brazil is causing the soybeans left in the field to deteriorate, and StoneX has cut their estimates for Brazilian production by 3 mmt as a result. This reduction brings their estimate for the bean crop to 147.8 mmt compared to 150.8 mmt in their last estimate.

WHEAT HIGHLIGHTS:

  • The wheat complex was strong overnight and into the 11 am CDT USDA WASDE report, as it continued to grapple with concerns regarding the Russian wheat crop with dry weather and the recent cold snap. Somewhat friendly supply and demand numbers helped press all three wheat classes higher into the close, with July Chicago setting a new high for the move and the highest close since last August.
  • The USDA released its monthly WASD report today, pegging 23/24 wheat carryout at 688 million bushels versus the average trade guess of 696 mb. They estimated 24/25 total wheat production at 1.858 bb, with carryout at 766 versus 786 mb expected. As for world ending stocks, 23/24 came in at 257.8 mmt with 24/25 at 253.61 mmt versus expectations of 256.9 and 257.37 mmt respectively.
  • The USDA made no changes to the Russian wheat crop and left its estimate at 91.5 mmt. SovEcon on the other hand lowered its estimate of Russian wheat production by 3.4 mmt to 89.6. The USDA did lower its forecast for Ukraine’s wheat crop 0.4 mmt to 23 mmt.
  • The Buenos Aires Grain Exchange in Argentina is projecting the country’s 24/25 wheat production to increase 20% to 18.1 mmt due to the recent rains that have set the stage for a good growing season. The exchange also sees wheat 24/25 wheat exports rising 24% from last year to 11.5 mmt.
  • A western Australian industry group raised concerns about Australia’s wheat crop due to the persistent dry weather and lowered its planted area estimate to 4.7 million hectares from its April forecast of 4.96 million.

DAIRY HIGHLIGHTS:

  • Class III futures were mixed on the day with the June and December futures contracts seeing gains while all other 2024 contracts were in the red.
  • Spot cheese and whey were unchanged Friday at $1.94625/lb and $0.3850/lb respectively.
  • Class IV futures were higher with the October futures contract seeing the largest gain at 14 cents to close at $21.68/cwt.
  • Spot butter was slightly weaker, dipping below $3.00/lb to $2.99/lb. Spot powder was the only product to see gains, increasing 1.50 cents to $1.1525/lb.

 

Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of the National Futures Association. Stewart-Peterson Inc. is a publishing company. SP Risk Services LLC is an insurance agency. A customer may have relationships with all three companies. TFM Market Updates is a service of Stewart-Peterson Inc. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.

Author

John Heinberg

Sign up to get daily TFM Market Updates straight to your email!

back to TFM Market Updates