Grain Comments: 05-12-2023

Good morning:

Nothing much matters until the first USDA print of the new crop (‘23/24) S&D later this morning; the same rhetoric continues from the Black Sea with most parties optimistic of a deal and Russia still complaining.

Rain fell in the western/central belt over the past 24 hours, shifting into the NW belt today and the northern Midwest tomorrow and lingering as late as Monday in far southern crop areas. Five-day forecasted totals look strong for all but the SW belt/southern Plains. Extended maps remain dry, with temps still mostly above normal but shifting into a warmer NW/cooler SE trend.

The long-awaited and much anticipated May WASDE report will be released today at 11:00 AM CT. AS stated several times this is the most watched report of the year as it contains our first look at new crop balance sheets. Nearly all predictions on what will be released indicate higher ending stocks for the 2023/24 marketing year than on the current year. While this is likely, the question is how much they may increase, and ultimately, what the new crop stocks to use ratios are. The current stocks to use on corn are 9.7% which is just above what is considered a rationing level. The new crop stocks to use are expected to increase considerably to roughly 15%. This would greatly reduce any rationing need. Soybean stocks to use is currently 4.8% which is considered a level that warrants rationing. The new crop ending stocks are expected to increase by nearly one-third, but this may still leave the complex in a rationing position. Wheat stocks to use are 31.9% and some models see this holding steady in the next marketing year. Trade will also show considerable interest in global stocks to use which are expected to show adequate reserves, even if tighter than in recent years.

Have a great weekend!