CORN HIGHLIGHTS:

• Selling pressure continued in the corn market after yesterday’s difficult close. Weakness across the grain market in general pressured corn futures, which slipped off early session highs. July corn is testing the 100-day moving average at 457, which could be a swing point in prices.
• Weekly export sales were within expectations but have been trending softer than a few weeks ago. USDA export sales report as new sales of corn over the last week at 29.2 mb (742,000 mt) of old crop and 5 mb (128,000 mt) of new crop. Old crop sales were down 17% from last week and 14% from the prior 4-week average. Export sales are still up 27% over last year’s totals.
• Near-term weather forecasts reflect a possible window for producers to push the planting pace. The next 5-6 days overall is looking for dryer conditions and could provide that opportunity. Longer-range forecasts are still looking at above average precipitation into the end of the month. A focus will be the planting pace in Iowa and Illinois, which were 13% and 14% respectively behind the 5-year average on the last crop progress report.
• Wheat market price action has been a limiting force on corn prices this week. For the third consecutive day, wheat futures have given up double digit price strength to close the day in the red, possibly signaling a near-term peak in that wheat market.
• Corn price rallies have been limited by selling pressure from producers in the US as well as Argentina and Brazil. New crop hedging pressure likely limited this most recent rally as Dec corn challenged the 500 price level.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day mixed with the July and August contracts higher but deferred contracts lower. Prices did rebound from earlier in the day, but a poor export sales report today along with disappointing NOPA crush numbers yesterday pressured futures today. Soybean meal was lower while soybean oil was higher for the day.
• Today’s export sales report for soybeans were poor at 9.8 mb in sales for 23/24 and 0.9 mb for 24/25. This was down 38% from last week and down 31% from the prior 4-week average. Last week’s export shipments for soybeans of 16.3 mb were above the 12.6 mb needed each week to achieve the USDA’s export estimate of 1.700 billion bushels. Although, total sales commitments are down 16% from a year ago. Primary destinations were to Egypt, China, and Indonesia.
• Yesterday, the USDA reported a private exporter sale totaling 180,000 mt of soybeans for delivery to unknown destinations. While not guaranteed, “unknown destinations” is often China, and this would be encouraging given the fear of retaliation for the new tariffs.
• On Tuesday, CONAB increased its estimate for Brazil’s soybean production by 1 mmt to 147.5 mmt. This is still well below the USDA’s estimate of 154 mmt. In Argentina, the Buenos Aires Grain Exchange also has its estimates for soybean production below that of the USDA.

WHEAT HIGHLIGHTS:

• Wheat posted small losses in Chicago and Kansas City futures, with more modest declines in Minneapolis futures. Lower corn and soybean prices failed to support to wheat, whose losses were compounded by a stronger US Dollar and a decline in Paris milling wheat futures. Additionally, the American weather model today hinted at better opportunities for rain in southern Russia that may alleviate some drought concerns.
• The USDA reported an increase of only 2.9 mb of wheat export sales for 23/24 and an increase of 11.2 mb for 24/25. Shipments last week, however, at 16.5 mb, just exceeded the 16.3 mb needed per week to reach the USDA’s export goal of 720 mb.
• Day two of the Kansas wheat crop tour confirmed what many thought – the crop is in much better shape compared to last year, but there are still trouble spots. Average yield for the second day came in at 42.4 bpa, which is above the USDA’s forecast for the state of 38 bpa. That is also above 35 bpa last year but below the 10-year average of 42.9 bpa.
• According to the USDA, as of May 14, about 25% of the US winter wheat crop is experiencing drought, a 3% improvement versus last week. Additionally, 14% of US spring wheat acres are said to be in drought, compared with 15% last week.
• GrainCorp Ltd suggests that persistent dryness in western Australia could significantly reduce Australian wheat exports. Although conditions on the East Coast appear more favorable, if this trend persists, it could raise concerns about global supply.
• The Rosario Grain Exchange in Argentina has said “There are factors favoring a successful wheat season.” Currently, soil conditions surpass those of the 21/22 season, which saw record production. Anticipated rains in the October/November timeframe, potentially driven by La Nina, could further benefit their crop. The exchange reports a 70% chance of La Nina affecting Argentina by October.

DAIRY HIGHLIGHTS:

• Although spot cheese was mixed with higher barrels and lower blocks, the block/barrel average did post a close over $2.00/lb for the first time since March 2023.
• For the first time since April 16, spot whey was bid 2c higher to $0.4150/lb. A rallying whey market should help push Class III higher.
• Bidding continued in the Class III trade, as both the Q3 and Q4 averages closed into new highs.
• Both June and July Class IV futures finished the day double digits higher, adding 10c each to $20.90 and $21.28 respectively.
• The dairy markets continued to rally, with most butter, whey, powder, and cheese futures closing green.

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Author

Amanda Brill