Black Sea tensions remain the massive wild card ahead of proposed talks in Moscow tomorrow, and the looming extension deadline coming up in two weeks. Besides that, the grains are in a fundamental rut with U.S. export prices generally non-competitive, planting happening at a breakneck pace before weekend rains, with more precipitation for the Plains wheat as well.
The Plains and Midwest were dry over the past 24 hours with rains firing up in the SW Plains tomorrow, moving through the southern belt Friday, with another system moving from the WCB Friday into the northern belt over the weekend. Coverage looks solid throughout the belt and the bulk of the Plains over the next five days, with above-normal 6–10-day rains as well, particularly in the WCB. Drier conditions are on tap for the 11–15-day time frame, with above-normal temperatures running right through the middle of the month.
Brazilian rains again fell far south over the past 24 hours and remain there through Monday, with drier weather throughout the country past that; moisture shortages will continue to expand in the north and northeast.
As always, export sales data will be a primary factor in today’s session. Trade is already expecting to see a poor number on corn given the high volume of cancellations we have seen in recent weeks. While the majority of this was from China, other importers are washing out of US purchases as well. To see a net negative corn sales number today would not come as a surprise given the number of cancellations we have seen. Soybean demand is also expected to be light as the US remains nearly $100.00 per ton above Brazil on export offers. Wheat demand has improved in recent weeks but is still down due to the ongoing sales out of the Black Sea before the probable closing of the Black Sea corridor. More interest is now falling on new crop export demand, which is down considerably from historical averages for this time of year. Trade is starting to look at total demand though, and when domestic consumption is added in, usage looks better. This is especially the case for the soy complex as building renewable fuel manufacturing will elevate crush as well. While this will not totally offset slowing exports it will keep overall soybean reserves at a level that will likely require rationing for another year.
Have a great day!