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Morning Comments

July corn +8 ½ AT 7.2025

July beans +8 ½ AT 15.96

The DOW is Down

USD is Down

Crude oil -.95 at 63.97

 

Good morning,

 

Overnight grain markets started out lower but have firmed back into positive territory with the bull spreads leading in corn, wheat, beans, and meal. Yesterday’s break was primarily weather inspired while today’s recovery looks to be driven by new longs taking advantage of the break ahead of tomorrow’s USDA crop report. The crop report is expected to reinforce the bullish old crop stats and carry them forward into the new crop marketing year as well. Trade estimates are posted below. The USDA announced China bought another 680 tmt of new crop corn.

In the product trade, meal has regained leadership over oil this month as the oilshare correction continues. Rapeseed follows yesterday’s limit move lower with a gap lower trading -$35. The veg oils are acting toppy. Malaysian palm oil is more subdued with some consolidation near its highs, closed -18 or -.41% to 4,350 ringgit.

US soybean planting progress advanced by 18% to 42% complete which was slightly ahead of the avg. trade guess of 40% and compares to the 5 yr avg. of 22%. IL is 57% planted compared to 25% on the 5 yr avg. and IA is 67% planted compared to 30% on the 5 yr avg. LA is only 40% planted compared to the 5 yr avg. of 64%. Soybean emergence was 10% complete compared to the 5 yr avg. of 4%. Corn planting advance by 21% to 67% complete, slightly ahead of the avg. trade guess of 66% and compares to the 5 yr avg. of 52%. Corn emergence was 20% complete compared to 8% last week and the 5 yr avg. of 19%. Spring wheat planting advance by 21% to 70% compared to the 5 yr avg. of 51%. Spring wheat emergence is 29% complete compared to 14% last week and the 5 yr avg. of 20%. Winter wheat G/E ratings improved by 1 to 49% and PVP declined by 1 to 18%.

 

Overnight, the corn market was mixed, but we appear to be setting-up for a classic “Turnaround Tuesday” early; by the morning pause, July Corn finished 8 cents higher and new crop Dec 3 cents better. The early headline was 680,000 metric tons of new crop corn sold to China, which is the third sale in as many days, and brings that total to just over 3 million metric tons. As we have noted, this is their first major foray into the 21/22 crop year, which to this point has been unexcitingly average. The remaining old crop bushels sold to China (~11 mmt) represents a wild card to the 20/21 balance sheet, and if rolled, could end up adding to 21/22. It is an obvious source of rationing to supply corn to other end-user sectors? So far, only cattle, and to a lesser extent dairy, are the only end-users not making money today? Weakness yesterday was tied to weekend rains in the heart of the Belt. It’s still a little chilly; when combined with these rains, it could park planters in the Eastern Belt in particular? By midweek, however, temps are expected to warm-up, which should offer a solid week of planting progress before rains return the middle of next week. The USDA’s Crop Progress data after the close yesterday pegged U.S. corn planting at 67% complete, advancing 21% wk/wk. This is roughly in-line with last year, but 15% ahead of the five year average. 20% of plants have emerged. Look for more position-squaring today in front of the USDA’s monthly crop report tomorrow.

 

Darren, David, and Elizabeth

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