The soybean complex dominated overnight trade volume with beans rebounding this morning, after the most-traded July contract matched its Friday low, but wheat is weighing on the grains overall with Chicago July wheat dipping below the $6/bu mark. Rains ironically continue in the South-ern Plains while generally skipping the Midwest, though that should allow the completion of row-crop fieldwork this spring and get the 2023 U.S. campaign off to a strong start. Exports remain a real problem for the grain bulls as well.
Friday afternoon’s USDA Cattle on Feed Report showed all U.S. cattle on feed as of May 1 at 11.608 million head, or 96.6% of last year, just a shade below the average 96.7% trade estimate. Cattle placements in April came in at 95.8% with marketings at 89.9%, both also a tick below the trade expectation.
Rains fell in southern U.S. crop areas over the weekend, heaviest in southern KS and central-eastern OK, with lighter amounts ranging up through the Ohio River Valley and far ECB as well. This work week’s totals look solid in the far WCB and Plains, once again heaviest in the SW Plains, but dry in the bulk of the Midwest. Both 6-10- and 11-15-day maps hold that above-normal precipitation out to the far west as well, with most of the Midwest dry, while temperatures hold safely above-normal now up through early June.
Brazilian safrinha crop areas were dry over the weekend and remain so this work week, but beneficial rains are on the way next week for the 6–10-day time frame, aiding northern and northeastern corn regions in particular.
Another increase in the planting pace on corn, soybeans, and spring wheat is expected in this afternoon’s weekly progress report. Corn and soybean planting is well ahead of normal and no longer much of an interest to trade. The only state receiving attention is North Dakota where corn was 6% planted and soybeans progress was 2% last week. Both of these should have seen advancement given more favorable weather. Spring wheat seeding is also expected to jump tonight. Now is when more interest will start to fall on long-range weather models and for the most part these are benign. The only weather concern we are hearing at this time is the developing El Nino but so far this is not encouraging risk premium to be added to futures. Given the size of crops being estimated and less than stellar demand we may not see much premium added until later in the season, if at all. We are also seeing more interest on US demand projections. The USDA is projecting a build in corn demand of 755 million bu (mbu) this coming year even though we have yet to see anything to substantiate this. The feeling is the USDA is projecting demand to meet crop size rather than current usage trends. Soybean and wheat demand is more even with this year and easier to believe at this time.
Have a great day!