May corn -1 ¼ AT 5.5825
May beans +12 ¼ AT 14.1425
The DOW is UP
USD is DOWN
Crude oil -.80 AT 60.65
Overnight grain markets featured strength in new crop corn and beans where a late attempt to incentivize additional acres is underway following last week’s prospective plantings report. New crop beans are also attracting new longs and narrowing their discount to old crop values as it becomes apparent that even with favorable growing conditions, carryout projections for next year will look similar to this year assuming demand doesn’t plummet. Old crop beans are lagging to new crop for the moment, but flat price is stabilizing back above $14 with domestic basis continuing to signal very tight supplies.
Reuters published an article quoting a source that sow stocks in northern China dropped between 25% and 30% in northern China from February to March due to the latest surge in African swine fever.
NASS will publish crop progress this afternoon including corn planting progress, bean plantings will be updated starting in two weeks.
US weather outlook shows rains disrupting field work at times this week with the heavier totals seen in the western half of the corn belt and delta. Above normal temps are seen for most of the corn belt with drier conditions too – except where you have above normal precip for the N Plains in the 6-10 day and in the S Plains in the 8-14 day.
We have another USDA crop report this Friday that will put the focus back on old crop ending stocks as they adjust demand projections. The new crop balance sheet reveal comes in the May crop report.
Overnight, the corn market started firm; old crop months quickly lost their initial bids, ultimately finishing a penny lower by the morning pause, while the new crop months finished 5-6 cents higher. The bear spread bias – ostensibly to buy a few more acres after the USDA’s intentions miss – is a continuation from Thursday. Overall, news flow to start the week is a mish-mash of cross-currents. On the weather front, a mostly favorable environment for northern hemisphere planting is seen, while there remains a low-level of concern over late safrinha planting (along with a dryer trend in some of those growing areas). Outside markets lean a little negative with Crude Oil down $1, but ethanol margins have not cared too much about recent choppiness, as they remain near the highest levels attainable since late last autumn. Domestic corn basis is firm, despite notions of more feed wheat inclusion here and abroad? So again, nothing universally bullish or bearish to start the week, which should keep the markets relatively choppy with plenty of volatility. There will be another USDA report Friday (just a monthly WASDE); the first national crop progress report is due after the close today, though it is expected to be highly wheat focused.
Darren, David, and Elizabeth