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Grain Comments: 05-15-2023

Good morning:

Corn was mixed overnight while soybeans were 6-10 higher and wheat was up 12-15 cents. The US dollar was weaker, and energies and equities were higher.

This morning’s April NOPA soybean crush is expected to come in at 174.2 million bushels, down from 185.8 mbu in March but above 169.8 mbu last April and a record for the month. Trade guesses range from 172.0-177.5 mbu.

Rains were widespread across the Plains and Midwest over the weekend and continue in the southern Plains up into the central belt this morning; action looks heaviest in the southern Plains/Midwest this week and lighter in the north, though coverage is still good throughout over the next five days. Extended maps are becoming more varied but remain mostly warm and dry.

There is little doubt trade will still be sifting through the May WASDE data today. One of the most talked about numbers was the increase in soybean ending stocks estimate on new crop of 119 million bu (mbu) from this year to next. Another is the tightening in global wheat inventory to one of the tightest in recent history even with record wheat production being forecast. Domestic wheat ending stocks are also expected to decrease to their lowest volume in 16 years due to large abandonment in the Plains. Now that this data has been released trade will shift the majority of its attention back to the US planting pace and crop development. Planting of both corn and soybeans has been running ahead of the average pace and this is unlikely to change today. The only real areas of concern on planting are North Dakota and Michigan. Last week the North Dakota planting pace was 1% finished and Michigan was 6%. Both of these are expected to show improvement this week. Soybean planting is ahead of normal and much less of a concern given the time frame that soybean planting can be completed in. Trade is now focusing on crop development, and so far, there are no concerns which verify the high yield estimates we are seeing. This has also limited the urgency to add risk premium to our current futures market.

Have a great day!

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