Profit taking Monday diminished the wet weather forecasts that provided support to our wheat markets for most of the trading session. All areas in the HRW and SRW regions saw 0.20 - 2.00 inches over the weekend. Eastern Oklahoma saw up to 3 inches. The extended forecast shows below normal temperatures and above normal precipitation.
As the old saying goes “Rising tides lift all boats” and we say that yesterday as the run-up in corn and wheat pulled the bean complex higher. Heavy rain and snow totals were the fuel for the rally. It is estimated that 10% of the bean crop had been planted, the question now is how many of these acres will have to be replanted. The good news for producers is there is plenty of time yet to get the crop in. We might even pick up acres if the weather doesn’t break fast as it will potentially force some corn acres into beans.
As we prepare for the month of May, it appears that the relative calm that we have enjoyed is about to end. We might even describe the last four months as ones of extreme calm. For soybeans, we had the narrowest January through April trading range since 2001; and for corn, it was the narrowest range since 2006. In fact, corn, wheat, soybeans and soy products all ended April within 1.5% of where they closed the month of March.
The U.S. current account deficit unexpectedly fell in the fourth quarter, hitting its lowest level in more than a year, as an increase in the primary income surplus offset a soybean-driven drop in exports.
As we began the month of January it appeared that flooding and wildfires in Argentina would be our dominant stories. However, just as conditions in Argentina started to improve, a new U.S. President was being sworn in. It quickly became clear that the new administration would create far more risk and uncertainty than this year’s South American weather.