Written Commentary
SOYBEANS
Soybean traded unchanged. Talk of rains in Argentina and slowdown in China soybean demand offered resistance. Tightening US 2021 supply and key USDA March 31 acreage and stocks report offered support. Dalian soymeal futures dropped 1.50 to near $497. Total US soybean export commit is near 2,220 vs 1,258. USDA goal is 2,250 vs 1,682 ly. China commit is near 1,313 mil bu with 80 in unknown. US Consumer demand remains strong for US soymeal. Conab est Brazil soybean crop at 135.1 mmt vs 133.8 previous and USDA 134. Trade survey est the crop closer to 131.7. Some est Argentina crop near 44 mmt vs USDA 47.5. Malaysian palmoil futures are at all time highs. Talk of higher US domestic soyoil demand for fuel also supports soyoil futures. Soybean futures have traded lower since USDA failed to lower US 2020/21 soybean carryout on March 9. SK remains in a broad 13.50-14.50 range until more is known about US 2021 supply.
Weekly nearby soybean futures chart
CORN
Corn futures closed mixed. Nearby market was supported by strong domestic basis levels and corn demand and talk of tightening US 2021 supply. Corn futures have traded lower since USDA Feb crop report. Futures also trended lower after USDA failed to lower US 2020/21 corn carryout on their March report. Some feel final US demand could be higher and carryout closer to 1,200 mil bu versus USDA 1,502. This week, there was some talk that final China demand for US corn may be lower than some private guesses. This could lower final US exports to 2,700 mil bu but still above USDA 2,600. Some feel increase in US vaccinations could help increase fuel demand and ethanol demand. Margins have finally improved. Dalian corn futures dropped 6 cents to near 10.61. Conab est Brazil corn crop at 108.0 mmt vs 105.5 previous and USDA 109. Trade survey est the crop closer to 105. Some est Argentina corn crop near 45 mmt vs USDA 47.5.mmt vs USDA 47.5. One group estimate average April-June corn futures near 5.30 and fall prices near 4.80. This due to favorable US summer weather. Key now is will funds hold on to net longs and USDA March 31 acreage and stocks report.
July corn minus December corn futures spread
WHEAT
Wheat traded lower. Forecast of good rains across US south plains and Midwest continues to offer resistance to futures. Fact USDA failed to lower Russia and EU wheat exports on their March 12 report also weighed on futures and triggered long liquidation. Since the Feb high near 6.88, WK has dropped 50 cents and is below the 20 and 50 day moving average. 100 day moving average is near 6.30 and futures have not traded below that line since early Dec. Matif and Black Sea wheat futures traded lower. USDA estimates US 2020/21 wheat carryout at 836 mil bu. Most private groups est US 2021 wheat crop near 1,900 mil bu and 2021/22 carryout near 705. Total commit is near 886 mil bu vs 868 ly. USDA goal is 985 vs 965 ly. US prices are not competitive for N Africa or Mideast buyers. Consumer demand remains strong for US bakers. Talk of higher US feed wheat demand and PNW white wheat going to China offers support.
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