Written Commentary
SOYBEANS
Soybeans ended lower. Steep losses in US equities and higher US Dollar continues to offer resistance to soybeans. Talk of US inflation getting worse, US Fed raise interest rates this week plus new concerns about food and fuel demand, Ukraine war and new covid cases in China continues to weigh on prices. US Midwest weather will be hot and dry this week and now into next week. Soybean. China is behind in soybean import buying to date. New Covid restrictions may be lowering food demand. USDA est US soybean plantings at 88 pct. Crop is rated 70 pct G/E vs 64 ly. IL is 76 G/E. IA 82 and ND 62. Best crops in Delta, IA and ECB with lowered rated crops in west. May NOPA soybean crush is est near 171.5 mil bu vs 169.8 in April and previous record in 2020 of 169.5. End of May soyoil stocks are est near 1,765 mil lbs vs 1,814 in April and 1,671 last year. US crush may be lower due to maintenance downtime, lower margins and problems buying soybeans.
CORN
July corn ended slightly lower and near 7.68. CZ was unch and ended near 7.21. Corn futures continued to see some selling and long liquidation on talk of less concern about US summer weather, higher US Dollar and lower energy prices. CN low was 7.59. Talk that this weeks heat and dryness across US Midwest offered support. USDA rated the US corn crop 72 pct G/E vs 73 last week and 68 last year. Some feel this is high enough for an yield above trend. Still, ratings could drop across the Midwest after 2 weeks of warm and dry weather. IL is 77 G/E vs 81 last week, IN 74 vs 76, IA 86 vs 86, MN 58 vs 60, NE 65 vs 75. US corn plantings is near 97 pct vs 94 last week. Some feel 350,000 ND corn intended acres may not get planted. Informa will be out tomorrow with updated estimates for US 2022 acres by crop. USDA update is June 30. On that day USDA will also estimate US corn stocks as of June 1. Strong domestic basis suggest stocks could be lower than implied use basis March-May use. There was late talk that US gulf corn basis firmed on commercial buying. Higher ethanol use could reduce South America corn exports. There remains concern that Ukraine war could limit corn exports from Ukraine.
WHEAT
Talk of US inflation getting worse, US Fed raising interest rates this week plus new concerns about food and fuel demand and Ukraine war continues to weigh on wheat prices. US inflation is at 40 year highs with US Dollar at 20 year high. USDA est US spring wheat plantings at 94 pct with crop rated 54 pct G/E vs 37 ly and 70 average. 10 pct of winter wheat crop is harvested with wide range of yield, little lower test weight and higher protein. Market is also selling off due to talk Russia will export 40 mmt wheat, according to USDA. Still it is difficult to arrange freight and insurance for Russian vessels. Matif wheat closed lower with futures trading off the losses in the US, versus the heat across Europe which is causing considerable concern for crops in the northern two thirds of the continent. Crops are early but it is also early for this kind of heat in Europe.
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