Ag Market View for May 5
Soybeans, soymeal, new crop soyoil, corn and wheat traded higher. US stocks were higher. US Dollar was higher. Crude was mixed to lower. Gold and copper were higher today.
Soybeans traded higher led by new crop. Slowdown in US soybean exports offered resistance to SN. Increase soyoil deliveries also and lower palmoil prices weighed on BON. There was talk of new money buying new crop soybeans on talk of below average US summer weather. Trade est weekly US old crop soybean sales are est near -100-200 mt vs 292 last week and new crop 100-600 mt vs 439 last week. Trade continues to hear that final US soybean crush could be higher than USDA 2,190. While US export pace is slowing, most feel US will export US USDA est of 2,280 mil bu vs 1,682 last year. This could suggest US final 2020/21 soybean carryout could drop below USDA 120. Matif new crop rapeseed futures traded higher on concern over EU 2021 crop. Canada rapeseed futures also traded higher on concern about Canada 2021 crop. Sunoil is already trading higher on concern about Ukraine 2021 crop.
Both nearby July corn and new crop corn futures made new highs today. Word that China had cancelled 140 mt of US old crop corn sales offered some resistance. Still some feel China needs that corn and may only cancel or roll to new crop if the supply is not available. There were also rumors that China may have been a big buyers of 1.5-2.5 mmt of US new crop corn. USDA announced Mexico bought 184 mt US 2021/22 corn. There was 147.3 US corn sold to unknow, 45.7 in 20/21 and 101.6 in 21/22. Trade est weekly US old crop corn sales near 200-900 mt vs 521 last week and new crop 100-600 mt vs 553 last week. US weekly ethanol production was up 1 pct from last week and up 59 pct from last year. Stocks were up 3 pct from last week but still down 20 pct from last year. Margins turned positive for first time since Oct, 2020. Informa dropped their estimate on 2021 Brazil corn crop 9 mmt to 95 vs USDA 109. This could eventually add 550 mil bu new US 2021/22 corn exports. This puts USDA in tough spot estimating US 2021/22 corn balance sheet. Informa raised Argentina corn crop 1 mmt to 47.There is talk that Argentina may have oversold their corn supply and drop in Parana river water levels could force exports to short load vessels. There was talk of new money buying new crop soybeans on talk of below average US summer weather.
Wheat found new buying on talk of new money coming into the grain space. Some are hearing from funds who have not traded the grain market from the long side since 2010. Most are looking for higher prices due to less than average US and Canada summer weather. On twitter, Reddit is calling for $14 dollar wheat. Managed funds were net buyers of 12,000 contracts of SRW Wheat. We estimate Managed money net long 15,000 contracts of SRW Wheat. Trade est weekly US old crop wheat export sales near 0-250 mt vs 223 last week and new crop 100-500 mt vs 237 last week. Informa raised Canada 2021 wheat crop 1 mmt to 32.8. Russia 2021 crop 3 mmt to 80, Ukraine 1 mmt to 28 and Australia 1 mmt to 26. Informa est US 2021 winter wheat crop at 1,307 mil bu vs 1,171 last year.
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