May 15, 2017
Corn futures closed a few cents lower, which was enough to put the lead July contract under a few key moving averages and near a one-week low as farmers likely made good planting progress during the warm, dry weekend.
Soybeans finished a little higher but were down from early highs as selling developed following a smaller-than-expected monthly crush.
The two winter wheat markets had the biggest losses of the day, likely due to pressure from last week’s U.S. Department of Agriculture forecast for big world supplies. Also, some reports linked the selling to Iraq buying Australian wheat instead of from the U.S., despite the U.S. wheat being the lowest priced.
More rain is in the forecast for the Midwest this week, with rain in Iowa Monday night and in Illinois on Wednesday. The 6- to 10-day outlook (May 20-24) is cool and wet for the western Midwest and warm and wet for the eastern areas.
Wall Street was higher when the crops closed. The Dow Jones Industrials were up about 80 points as higher oil prices lifted energy company shares. The dollar was lower and gold higher.
Export data (from USDA and Reuters):
- Weekly export inspections million bu. (last week, estimates: corn 55 (33.2, 31-39), soybeans 10.3 (13.6, 11-16) and wheat 25.4 (24.2, 12-22).
- Iraq bought 50,000 metric tons of wheat from Australia. The tender closed May 7, but results were reported on Monday. It paid $271.17 per ton, c&f.
- Jordan seeks 100,000 metric tons of hard milling wheat and 100,000 of feed barley all from optional origins. The wheat deadline is May 16 and barley May 17. Both are for October-November shipment.
- Turkey seeks to buy 180,000 metric tons of feed corn. The tender deadline is May 18. It seeks the corn from a number of countries including the United States. Shipment details were not provided.
Corn futures closed a few cents lower, with the July close dropping under key moving averages.
Analysts expect that about 67% of the corn will be planted in the USDA crop progress report, which would be a little under last year’s five-year average of 70%.
Forecasts show severe storms in parts of the western Midwest Mondday and Tuesday, with rain lingering on Wednesday.
Weekly export inspections were better than expected, at about 55 million bu., and topped the pace needed to meet USDA’s annual forecast. Japan, Mexico and South Korea were the leading destinations.
The Chicago Board of Trade (CBOT) estimated Monday’s corn volume at 163,117. Friday’s actual volume was 146,686. Open interest in Friday’s firm market increased by 3,329 with May’s down 46, July’s up 1,211 and December up 2,457.
July corn closed down 3-1/4 cents at $3.67-3/4 and new-crop December dropped 3-1/2 to $3.85-1/4.
What to Look For: Corn planting is planting is winding down. The condition of the crop in Illinois and other rain-soaked areas will be watched. Some fields may have to be replanted.
Soybeans closed a little higher after three days of losses, with July settling at the 20-day moving average.
The rebound was hindered by NOPA’s April crush of 139.134 million bu. That was down from 153 million in March and last year’s 147.6 million. It also missed trade forecasts. Farm Futures analyst Bryce Knorr said processing plants appear to be cutting the crush to support margins.
CBOT estimated Monday’s volume at 112,556. Friday’s actual volume was 100,915. Friday’s open interest increased by 3,742 in the lower market with May’s down 9 and July’s up 109. November’s open interest increased by 2,094.
July soybeans closed up 2-1/4 at $9.65-1/4 and August up 1-3/4 at $9.64-3/4. New-crop November rose 1 to $9.60-3/4.
What to Look For: Analysts expect soybean planting to be about 29% completed as of Sunday. The five-year average is 32%.
Winter wheat markets had the largest losses of the major crops, and hard red winter (HRW) is now below pre-snowstorm levels and under key moving averages.
Wheat markets have struggled since last week’s USDA report that showed ample world supplies despite smaller production in the U.S. The selling in HRW came after the CFTC on Friday showed hedge funds turned net long as of May 9 after favoring the short side of the market. Funds also had reduced their net short in soft red winter (SRW) wheat.
Forecasts have severe storms in the central Plains today and tomorrow, some of which will be in areas hit by the snowstorm in late April.
CBOT estimated Monday’s SRW wheat volume at 101,460. Friday’s actual volume was 87,192. Open interest in Friday’s weak market decreased by 2,388, with May’s down 12 and July’s down 1,004. December’s decreased by 366.
Chicago, Ill., July SRW wheat closed down 9-1/2 at $4.23-1/4 and September down 8-3/4 at $4.38. Kansas City, Mo., July hard red winter wheat closed down 10-3/4 at $4.28-1/2 and September down 10-1/2 at $4.45-1/2. Spring wheat for July dropped 6-1/2 to $5.40 and September was down 6-1/4 at $5.47-1/4.
What to Look For: Damage is still being assessed in the Plains from the storm two weeks ago. USDA will update wheat condition ratings later today, with average estimates putting winter wheat at 52-53% good/excellent versus last week’s 53%.
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