Corn: When trade closed on Friday, the corn market was left looking at moderate rains all the way out to the 15-day outlook. Even Friday it would have been easy to say that it wouldn’t take much of a change to see a bearish map by Monday morning.
Sure enough, the Monday morning maps suggested one more solid rain system for the Midwest over the next three days followed by a drier and warmer forecast to follow. In both the six- to 10-day and the 11- to 15-day forecasts, there are still rains in some areas but not for all. In general, the eastern Corn Belt and some areas in the northern Midwest still look to see one-inch and more rains, but most of the Midwest will only be looking for hit and miss rains totaling a quarter-inch.
Along with the drier bias, there is also above average temperatures in the six- to 15-day forecast as well. Early corn selling took the weekend update into account and likely factored in that the noon maps would agree, which is exactly what was seen. While there is still no forecast that is totally clear for planting, there is also no reason to expect heavy selling to take out 530 area support.
Looking forward, there still appears to be a solid range trade in December corn between 528 and 550. Right now, it is hard to see imagine a forecast dry enough to cause a major break through support or wet enough to take out resistance. Larger speculative support in December is expected at 515 if the corn can find a move to that level.
Old crop was bought aggressively by the spreaders once again buying the May corn and selling other contracts on a spread looking for another run based on continued strong basis. Trade was not looking for much in the way of planting progress, expecting a 6% national pace that came in at 4%. Trade is ready for the rain system Monday and Tuesday, and now we will see what changes are made to the extended forecast over the next two weeks. For now, December is in a solid range and it will likely take major changes to the forecast to break that range in the next couple weeks…Ryan Ettner
Soybeans: The bean market started the week on a sour note, as flat price sold off but the bull spreads managed to gain in spite of the downward pressure. Overall, you would call the day’s volume lack luster.
Weather was getting a negative spin Monday as long-range maps are hinting a pattern change to a “warmer” and “dryer” forecast. The bears hope that as the calendar changes to May so the planters will start to roll.
The bird flu story seems to be picking up again. Officially, 102 people have been infected by the flu with 20 reported deaths due to the sickness. There are reports that the amount of people infected has been drastically under-reported. The trade is worried that a wide spread outbreak will have a negative impact for demand of beans and meal. It is being reported that China’s poultry industry loses are projected to top $2 billion in just a month. China’s customs reported that China’s March bean imports were only 3.8 mmt, which was down 20% from a year ago. The year-to-date soybean imports of 11.4 mmt are down 13.3% from last year. Despite this news, the USDA reported the sale of 174,000 mt of beans sold to China for new crop delivery. There continues to be talk that China might be in to buy some old crop beans from the U.S. due to continued shipping delays out of Brazil. Reuters is reporting that trucks are making a 1,000-mile detour by driving to the country’s southern tip just to avoid the unloading/loading delays in the northern ports. This would be like taking a load of beans from Chicago to Orlando to unload and then drive back.
Monday's export inspections came in at 4.970 million bushels below the trade estimate of 5 to 10 million bushels. With the U.S. farmer continuing to hold out for higher cash bean prices and the market seeing continued demand for U.S. beans, it should support the old-crop beans while the new-crop bean will continue to see pressure as the planters being to roll…Jim McCormick
- Wheat inspections came in at 24.848 mmt, which was within the estimated range of 18.0-25.0 mmt.
- Egypt expects wheat production at 10 mmt, up from the estimate of 9.5 mmt.
- Weather forecasts are calling for freezing temperatures to continue into Wednesday through most of the HRW area.
- The wheat complex finished lower Monday with warmer temperatures and increased moisture expected in the Midwest. EU wheat crop improves on warmer weather.
- China’s March wheat imports were 289,344 mmt, down 46% from last year.
- Wheat good-to-excellent ratings were down 1% from last week at 35% G/E.
- Spring wheat planting progress at 7% versus the five-year average of 24%, which should continue to give support to the Minneapolis wheat market…Alex Bassett