Written Commentary
Ag Market View for Apr 26.24
April 26, 2024
CORN
Prices closed steady to slightly lower as spread weakened into the close. Near term support for May-24 at last week’s low at $4.31 ¾ with resistance at the 50 day MA, currently $4.44 ¾. Dec-24 corn continued to consolidate near its 50 day MA at $4.71 ¾. Not much moisture is expected for the central Midwest over the next 5 days. A storm system for next weekend will be monitored closely as it has the potential to bring much needed moisture for Iowa and southern MN. Export inspections at 49 mil. bu. were in line with expectations. YTD inspections at 909 mil. up 31% from YA vs. the USDA forecast of up 26%. Largest destinations was Mexico with 22 mil. bu. Money managers last week were net buyers of nearly 41,000 contracts reducing their short position to 256k. MM’s have been short corn for 37 consecutive weeks, 2nd longest stretch on record. Since the CFTC began breaking out MM’s as a trader class nearly 20 years ago the longest stretch was 54 weeks that ended in Aug-2020. Ukraine’s Ag. Ministry forecasts 2024 corn acres at 3.86 mil. HA, down 4.5% from YA. Last month a survey among farmers suggested a 9% decline. Since July-23 Ukraine’s corn exports have reached 17.4 mmt, down 17% YOY.
SOYBEANS
Prices were lower across the board with beans down $.09 – $.11, meal was $1 – $3 lower while oil was down 55 – 75 lower. May-24 beans were unable to hold overnight trade over $12. Early strength in May-24 oil stalled out just below the Jan-24 high at 49.95 as it consolidates near its 100 day MA at 48.67. Heavy rains with some isolated flooding occurred in RGDS Brazil and EC Argentina since late last week. More rain is expected this week. Little rainfall this past weekend thru midweek for WC state of Mato Grosso Do Sul. Showers are expected to fill in by Thur/Fri of this week, providing some needed relief. Export inspections at 25 mil. bu. were in line with expectations. YTD inspections at 1.314 bil. are down 19% from YA vs. the USDA forecast of down 14%. Shipments to China were 20 mil. bu. Money managers were net buyers in soybeans last week for the 1st time since early Nov-23 buying nearly 17k contracts, reducing their short position to 155k. MM’s were net buyers of just over 29k oil while selling 1,400 meal. AgRural estimates Brazil’s soybean harvest has reached 63% as of March 14th. Late on Friday Safras & Mercado lowered their Brazilian production forecast slightly to 148.6 mm,t vs. the USDA at 155 mmt and Conab at 146.8 mmt.
WHEAT
Prices were higher across all 3 classes with Chicago up $.12 – $.14, KC $.07 – $.08 better, while MGEX slipped late closing $.04 higher. With wheat prices hovering just above 3 year lows, additional war premium is needed as missile and drone attacks in the Black Sea region have escalated. Russian attacks on Ukraine’s grain infrastructure in Odessa caused an underdetermined amount of damage over the weekend. First resistance for May-24 Chicago is last week’s high at $5.56. Resistance for May-24 KC is at the 50 day MA which is now $5.98. May-24 MGEX seems stuck between $6.40 – $6.75. Export inspections at 11 mil. bu. were at the low end of expectations. YTD inspections at 505 mil. are down 16% from YA vs. the USDA forecast of down 6.5%. MM’s were net sellers of 13,300 contracts of Chicago wheat last week extending their short position to nearly 79k, a 3 month high. They were net buyers of 2.4k MGEX and 5.3k of KC. SovEcon reports Russian grain exports are expected to reach 5.8 mmt in March, up from 4.9 mmt in February. Since July-23 Ukraine’s wheat exports have reached 12.9 mmt, up 5% YOY.
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