SOYBEANS
The soybean complex was lower across the board however recovered to settle well off session lows, particularly for spot May-23 soybeans. May-23 made a new high inverse to July-23 closing at $.35 over, a flection of the tighter than expected stocks and limited farmer selling. Spot board crush margins sunk another $.21 today to $1.02 per bu., its lowest level in 10 months. I do not expect the USDA to change their current crush est. of 2.220 bil. bu. in next Tues. WASDE report. Brazil exported 13.3 mmt of soybeans in Mch-23, the highest monthly total since May-21. Brazilian soybeans remain roughly $60 – $65/mt below US Gulf. StoneX raised their Brazilian soybean production forecast 3 mmt to 157.7 mmt, above the USDA forecast of 153 mmt. Their also raised their Brazilian export forecast to 96 mmt, vs. USDA at 92.7 mmt. Dr. Michael Cordonnier left his South American production forecast unchanged at 151 mmt for Brazil, and 26 mmt for Argentina.
CORN
Corn closed $.04 – $.09 lower. Forecasts for temperatures to surge across the nation’s midsection next week would lead to a favorable jump in planting progress. While this is good news for Midwest corn and soybean growers, it’s more of the same for the drought stricken US southern plains. A rapid temperature rise could also prompt flooding across the Northern plains as the current snow pack melts. May-23 violated both its 50 and 100 day MA’s intraday, however recovered to close well off its lows. Next support is at $6.45. US corn plantings were reported at 2%, same as YA and 5-year average. If the 6-10 and 8-14 day forecasts hold, look for significant progress made by the end of April. Brazil exported 1.34 mmt of corn in Mch-23, down 41% from Feb-23 however it was still a record high for March. Ethanol production tomorrow is expected to show a slight drop from last week’s 1,003 tbd pace. I also look for stocks to drop a touch from last week’s 25.5 tb. StoneX raised their Brazilian corn production forecast to 131.3 mmt, well above the USDA forecast of 125 mmt. Despite the higher production forecast, StoneX is forecasting Brazil’s corn exports at only 48 mmt, below the USDA’s 50 mmt. Dr. Michael Cordonnier left his South American production forecast unchanged at 121 mmt for Brazil, and 36 mmt for Argentina. The Renewable Fuels Association reports the sale of E-15 (15% ethanol) reached 1.02 bil. gallons in 2022, up 26% from 2021. This same level of sales will be difficult to repeat in 2023 unless waivers which allowed the easier sale of E-15 in 2022 are reissued this year.
WHEAT
The wheat market couldn’t hold the early day strength as all 3 classes closed with modest $.02 – $.04 losses. Trade sources state there were 7 firms participating in Jordan’s 120k mt wheat tender with no purchase made. The USDA attache to India projects 23/24 wheat prod. at 108 mmt, up from the USDA forecast of 104 mmt in 2022/23. SovEcon reports Russia exported 4.5 mmt of wheat in Mch-23, more than double the 2.1 mmt they sold in Mch-22. They went on the state domestic wheat prices in Russia are the lowest since 2019, roughly $145/mt. US winter wheat crop ratings showed 28% G/E vs. 30% YA. 36% of the crop is in poor/VP condition, same as YA. 57% of the Kansas crop is in poor/VP condition. 6% of the crop is headed vs. 4% YA and 5-year average of 2%.
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