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Grain Comments: 04-12-2024

Good morning.

Ag markets have been two-sided in post-report overnight trade. Yesterday’s numbers failed to shine any new light on the fundamental situation in corn or soybeans. As has been mentioned previously, the attention of the market now turns almost entirely to the US Spring growing season, where weather forecasts have advertised the chance to get some good progress made by the end of April. The US$ index has jumped out to new highs again overnight, which likely limits rallies going into the weekend. Corn futures are unchanged to a penny higher, soybean futures are 3-4 cents higher, and the Chicago wheat market is unchanged. Products are firm, soybean meal is trading $1-2/ton higher, and soybean oil is up 10-15 points. Outside markets are mixed, crude oil futures are trading $1.30/bbl higher, the Dow Jones index is down 100 points, and the US$ index is up 60 points.

USDA Thursday on the corn side increased ethanol use 25 mil bu, increased feed/residual 25 mil bu, and made no changes to the supply side, resulting in ending stocks being lowered to 2.122 bil bu.

Soybeans saw a 5 mil bu reduction in imports, a 20 mil bu reduction in exports, and a 10 mil bu reduction in seed/residual, which resulted in ending stocks coming in higher at 340 mil bu.

Conab also did not make any real significant adjustments; soybean production for Brazil was lowered from 146.9 mmt’s to 146.5 mmt’s, while corn production was lowered from 112.7 mmt’s to 111.0 mmt’s.

The only change USDA made to South American crop production estimates was a 1 mmt reduction in the Argentina corn crop. No changes were made for Brazil.

Last note on yesterday as it pertains to Brazil; USDA and Conab are 13 mmt’s apart on total corn production and are 8,5 mmt’s apart on soybean production. These are historic differences.

Chinese trade data shows the country imported 5.54 mmt’s of all origin soybeans in March, down 19% from March 2023 but up marginally in February.

In other Chinese import news, Bloomberg yesterday reported the cancelation of 4-5 cargoes of Ukraine corn by Beijing for April-June shipment. The cancelations were said to have occurred in the last two weeks.

The Buenos Aires Grains Exchange lowered their estimate of the Argentine corn crop late Thursday to 49.5 mmt’s. Harvest was seen 15.3% complete, while soy harvest was seen 10.6% complete.

Barge shipments down the Mississippi River declined from 659k tons last week to 424k tons in the week ending April 6th. Corn shipments were down 36%, while soybean shipments were down 23%.

The ECB left rates unchanged Thursday at 4% for the fifth straight meeting but did signal a possible divergence from the Fed was coming as it indicated a June rate cut was still likely. This sent the US$ index sharply higher.

Weather forecasts were mostly unchanged overnight for the US Midwest. The Great Lakes Region sees the best chance of rain over the next week, while moisture returns to the SE in the two-week period.

Temps remain in a warming trend into the end of April, with models still seeing one more shot at cooler air around April 20th.

South America sees heavy rains in Southern Brazil into Argentina over the next 10 days, which has been the driest areas of safrinha corn production. Heat remains confined to the far North.

Have a great day!

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