Grain prices faced another technical setback on Monday as the focus remains on South American production potential (hint: Brazil should capture a record soybean harvest this season) and the Black Sea region, where a renewal of a safe passage agreement between Russia and Ukraine is expected to be extended. Wheat prices were hit the hardest, with most contracts losing 1.75% to 2.25%. Corn prices trended around 1% lower, while soybeans dropped 0.75%.

Most fields across the Midwest and Plains will gather at least some measurable moisture between Tuesday and Friday, per the latest 72-hour cumulative precipitation map from NOAA. The Mid-South is likely to see the highest accumulations during this time. NOAA’s new 8-to-14-day outlook predicts seasonally wet weather for the entire central U.S. between March 6 and March 12, with widespread cooler-than-normal conditions also likely next week.

On Wall St., the Dow had a rough week last week but improved 133 points to 32,950 in afternoon trading as investors brace for the next round of corporate retail earnings reports. Energy futures were mixed but mostly lower. Crude oil faded 1.5% lower this afternoon to $75 per barrel on rising domestic stocks. Gasoline shifted 0.25% lower, while diesel firmed 0.5% higher. The U.S. Dollar softened moderately.

On Friday, commodity funds were net buyers of soymeal (+2,000) contracts but were net sellers of corn (-10,000), soybeans (-5,500), soyoil (-4,000) and CBOT wheat (-16,000).

Corn

Corn prices took a moderate hit after spillover weakness from wheat and a pedestrian set of export inspection data led to a round of technical selling. March futures dropped 7.5 cents to $6.4250, with May futures down 5.75 cents to $6.4350.

Corn basis bids held steady across the central U.S. on Monday.

Corn export inspections faded 8.2% lower week-over-week to 22.5 million bushels. That was near the middle of analyst estimates, which ranged between 14.8 million and 29.5 million bushels. Mexico was the No. 1 destination, with 12.6 million bushels. Cumulative totals for the 2022/23 marketing year are still running significantly behind last year’s pace, with 563.3 million bushels.

The latest data from Ukraine’s agriculture ministry shows the country’s 2022/23 grain exports are down 27% year-over-year so far as the ongoing Russian invasion has officially gone on for more than a year now. Exports include corn sales totaling 708.6 million bushels of corn and wheat sales totaling 411.5 million bushels. Ukraine is a among the world’s top exporters for both commodities.

In Brazil, the top production state of Mato Grosso group may have 20% of its second corn crop planted outside of the ideal climate window, according to farm group Imea. The second corn crop accounts for around 75% of the country’s total corn production.

USDA will release its survey of Prospective Plantings at the end of March, notes grain market analyst Bryce Knorr. A few factors should dominate the direction the grain market takes until that time. “Along with South American weather, the acreage debate should suck up most of the oxygen in the market, barring some wild card news from Wall Street, Ukraine or elsewhere around the world,” he says. Catch up on more of Knorr’s latest analysis here.

Preliminary volume estimates were for 433,522 contracts, trending moderately below Friday’s final count of 545,731.

Soybeans

Soybean prices followed other grains lower on Monday, but losses were kept somewhat in check by ongoing concerns about Argentina’s waning production potential. March futures dropped 11.5 cents to $15.1750, with May futures down 6.5 cents to $15.1275.

The rest of the soy complex was mixed. Soyoil prices incurred significant losses after trending more than 1.75% lower today, while soymeal prices moved modestly higher.

Soybean basis bids were largely unchanged across the central U.S. on Monday but did shift 5 cents higher at an Illinois river terminal today.

Soybean export inspections were disappointing after coming in at less than half of the prior week’s tally, with 25.4 million bushels. It was also below the entire set of trade guesses, which ranged between 31.2 million and 62.5 million bushels. China was the No. 1 destination, with 13.6 million bushels. Cumulative totals for the 2022/23 marketing year are still slightly above last year’s pace, with 1.546 billion bushels.

Brazilian consultancy AgRural reported that 33% of the country’s 2022/23 soybean harvest has been completed through last Thursday. That’s well below last season’s pace of 43%. AgRural is expecting a record-breaking production of 5.545 billion bushels.

Preliminary volume estimates were for 233,882 contracts, shifting moderately below Friday’s final count of 272,908.

Wheat

Wheat prices suffered another big technical setback on Monday, incurring double digit losses by the close due to a variety of factors, including strong overseas competition and potentially improving soil conditions in the U.S. Plains ahead of USDA’s next crop updates that will be released later this afternoon. March Chicago SRW futures dropped 12.25 cents to $6.96, March Kansas City HRW futures lost 22.25 cents to $8.1950, and March Kansas City HRW futures fell 16.5 cents to $8.69.

Wheat export inspections were solid, climbing 58% higher week-over-week to reach 21.7 million bushels. It was also above the entire range of trade guesses, which came in between 9.2 million and 18.4 million bushels. Mexico was the No. 1 destination, with 2.8 million bushels. Cumulative totals for the 2022/23 marketing year are slightly below last year’s pace so far, with 560.0 million bushels.

Russian consultancy Sovecon estimates that the country’s wheat exports in February will fall to 113.9 million bushels. That would be a monthly decline of 18% and the lowest monthly total since last July, if realized. Russia is the world’s No. 1 wheat exporter.

China concluded its auction to sell 5.2 million bushels of its imported wheat reserves on February 22. That was 100% of the grain on offer. China has offered a series of similarly sized auctions in recent months in an attempt to boost local supplies and push down high prices.

South Korea issued an international tender to purchase 3.1 million bushels of milling wheat sourced from the United States and Canada that closes on Tuesday. Of the total, 59% is expected to be sourced from the U.S. The grain is for shipment in May.