Ag Market View for Apr 21

Soybeans, soyoil, soymeal, corn and wheat traded higher. US stocks were higher. US Dollar was mixed. Crude was lower.

SOYBEANS

Soybeans traded sharply higher. Higher US domestic soybean basis and higher World vegoil prices helped push futures higher. Talk of short covering before May deliveries also offered support. China Ag Minister announced new guidelines for hog and poultry margins that suggest less soymeal in rations. Some feel record feeding of higher protein wheat could be reducing need for soymeal for now. Dalian soymeal futures were  higher and near 528. Malaysia palmoil futures also traded higher on supply concerns and following higher US soyoil prices. Talk of US using soyoil as biofuel for jet fuel should push soyoil futures higher. Weekly US soybean old crop export sales are est near -100-250 mt vs 90 last week. New crop 250-500 mt vs 265 last week. SK also supported by est of lower US 2020/21 soybean carryout and tight US 2021/22 carryout even with normal crop.

CORN

Corn futures traded higher. Support was from rumors China was looking to buy 1.0-2.5 mmt US new crop corn. US China Ag Attaché estimated China 2020/21 corn imports at 28 mmt vs USDA 24. Corn also supported by talk that US ethanol plants are seeing better margins and willing to pay up for cash corn ownership. Weekly US ethanol production was unchanged from last week but up 67 pct from last year Covid impacted production. Stocks were also unchanged from last week but also down 26 pct from last year. Trade also supported by talk US 2020/21 corn carryout could drop below last USDA guess due to higher exports and domestic use. Talk of lower Brazil corn crop could reduce their exports and increase US. Some feel Brazil crop is closer to 100 mmt vs USDA 109 and could drop to 91-93 mmt if May weather is dry. Weekly US old crop corn export sales are est near 300-800 mt vs 327 last week. New crop is est near 50-300 mt vs 52 last week. One of the biggest bulls in the market suggested spec longs take some profits as both CK and CZ are near key price objectives. Interesting that same group is suggesting US end users to buy May and take delivery if they cannot secure summer cash needs. April 1 cattle on feed could be up 6 pct. Placement up 33 pct. 

WHEAT

Wheat futures traded higher. Some concern about colder than normal US temps lowering US 2021 HRW crop especially in OK offered support. Some buying also linked to a second morning of colder than normal temps stressing US SRW crop. 4-5 pct of MO and IL SRW crop are heading. MATIF wheat futures continued to trade higher and near 6 week highs on concern about Canada, north US plains, west Europe and Black Sea 2021 wheat crops. There continues to be growing uncertainty over Russia 2021/22 wheat exports. WK. KWK and MWK are nearing key price objective. Some feel less than ideal US and north hemisphere weather will be needed to push futures considerably higher. Some still feel increase US vaccinations will help increase US food demand the last 2 quarters of 2021. Energy prices were lower on concern that increase in global virus cases could slow rebound in global economies. World 2021 wheat crop will need to increase 10-12 mmt to keep World end stocks from declining for the 5^th straight year. World Bank this week increased their forecast of World 2021 food inflation by 17 pct.