Written Commentary
SOYBEANS
Soybean prices ended marginally lower. China cancelled 100 mt US soybeans. This was rumored yesterday and switched to Brazil. Some feel Brazil may be close to being sold out for new crop soybean export. Informa estimated US 2022 soybean acres at 88.7 mil versus USDA March of 90.9 and 87.2 last year. Trade est US old crop soybean export sales near 100-500 mt vs 429 last week and 100-600 mt new crop vs 595 last week. Soybean open interest high this year was in Feb near 863,000 contracts. Low was in May at 695,000. Today is near 755,000. Higher Futures prices tend to increase open interest. Lower open interest suggest lower futures price direction. Soymeal open interest is near 385,000 vs Jan low of 359,000 in May. High was 451,000 in Feb.
CORN
Corn prices are higher following higher US stocks and lower US Dollar. There is talk that Managed funds may be done liquidating long corn positions for now. Strong US domestic cash basis supports spreads and futures. Informa estimated US 2022 corn acres at 91.0 mil versus USDA March of 89.4 and 93.3 last year. They estimated US 2022 corn crop near 15.1 bil bu vs 14.93 ly. Trade est US old crop corn export sales near 100-500 mt vs 280 last week and 50-400 mt new crop vs 73 last week. Weekly US ethanol production was up 2 pct from last week and 3 pct ly. Stocks were down 2 pct from last week but up 12 pct ly. Margins have turned lower. Corn open interest high this year was in Apr near 1,625,000 contracts. Low has been near 1,523.000 since May 1. Higher futures prices tend to increase open interest. Lower open Interest suggest lower futures price direction. Over the last few days commercials have been net buyers of US cif export. Some link this to talk Brazil and Argentina may increase corn use for ethanol at the expense of exports. US 2 week Midwest weather forecast is warm and dry. Some are also estimating there may be a high chance the ridge could become more permanent in south central Midwest through July. US summer weather is still key for price direction. There was talk that Biden may soon propose building temporary silos near Western border of Ukraine to help move Ukraine food exports to the west.
WHEAT
Wheat futures ended mixed to lower. The French wheat export line-up shows sizeable ongoing shipments to Morocco and sales to Indonesia and rumors that France may have some wheat business to Iran. All this plus the ongoing heat kept EU cash premiums firm with farmers still not selling. Futures may still be one headline away from limit up or down movement. Cash basis on winter wheat is converging between old crop and new crop. Big “harvest pressure” basis drop may be limited this year with ample space in country and futures in a carry. HRW yields are getting better as progress moves further up north in KS. TW lower and protein higher so far in OK/TX. Informa today estimated US 2022 wheat acres at 46.4 vs 46.7 ly. Winter wheat is 34.3 vs 33.6. They dropped US spring wheat acres to 10.5 vs USDA March at 11.2 and 11.4 ly. They still estimate US 2022 wheat crop at 1,750 mil bu vs 1,646 ly. Trade est US wheat export sales near 200-600 mt vs 451last week. Chicago wheat open interest high this year was in Feb near 402,000 contracts. Low was in May at 307,000. Today is near 337,000. Higher futures prices tend to increase open interest. Lower open Interest suggest lower futures price direction.
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