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Grain prices fell back into the red on Thursday, mirroring losses in other sectors (particularly crude oil futures), which triggered a widespread round of technical selling today. Corn prices took a moderate hit of around 0.75%, with traders largely shrugging off an excellent round of export sales data from USDA this morning. Soybean prices were down around 0.5%. Winter wheat prices were slashed by double digits.
Ample rains stretching from the Southern Plains through the eastern Corn Belt could deliver another 1” to 2” or more across a wide number of fields between Friday and Monday, per the latest 72-hour cumulative precipitation map from NOAA. Later on, NOAA’s new 8-to-14-day outlook predicts seasonally wet weather for the Plains and western Corn Belt between May 28 and June 3, with warmer-than-normal temperatures likely for most of the central U.S. during this time.
On Wall St., the Dow moved back above the 50,000-point benchmark after rising 349 points this afternoon to 50,358 with traders betting on a solution to Middle East conflicts arriving sooner rather than later. Energy futures faded lower, with Brent crude oil down around 2% this afternoon to $102 per barrel. Gasoline futures tilted 3% lower. The U.S. Dollar firmed moderately.
Corn prices failed to find forward momentum
A round of technical selling, partly spurred by spillover weakness from a broad set of other commodities, led to losses of 0.75% or more on Thursday. September futures fell 4 cents to $4.6850, with December futures down 4.25 cents to $4.85.
Corn exports saw 83.6 million bushels in old crop sales, plus another 11.1 million bushels in new crop sales for a total volume of 94.8 million bushels. That was up noticeably week-over-week and eclipsed the entire set of trade guesses, which ranged between 37.4 million and 74.8 million bushels.
Corn export shipments faded 13% lower this past week after reaching 56.9 million bushels. Japan, Mexico, Colombia, Taiwan and Saudi Arabia were the top five destinations.
Earlier this week, U.S. Secretary of Agriculture Brooke Rollins announced new efforts to boost American fertilizer production, which includes permitting for a new CF Industries ammonia plant – a $3.7 billion facility that will be the largest of its kind in the world. “We’re so excited about not only the fertilizer implications of that, but the hundreds and hundreds of jobs that will come along with it for the great state of Louisiana,” Rollins said. Farm Progress policy editor Joshua Baethge took a look at what else is in the works – click here to learn more.
South Korean importers purchased 2.6 million bushels of corn in a tender that closed earlier today and an additional 2.6 million bushels of corn in a private deal. That grain will likely be sourced from the United States, South America or South Africa and is likely for shipment in June and July.
Corn settlements on Wednesday were for 454,274 contracts.
Soybean prices followed other commodities lower
Prices tested gains at times in today’s choppy outing but ultimately closed around 0.5% lower amid some late-session technical selling. July futures dropped 5.5 cents to $11.9425, with August futures down 5.75 cents to $11.9350.
The rest of the soy complex also eroded lower today. July soymeal futures were down around 0.75%, while July soyoil futures tilted more than 1% lower.
Old crop soybean sales improved 62% versus the prior four-week average to 12.9 million bushels. New crop sales contributed another 6.3 million bushels, for a total volume of 19.3 million bushels. That was toward the higher end of analyst estimates, which ranged between 5.5 million and 23.8 million bushels.
Soybean export shipments faded 21% lower week-over-week and 18% from the prior four-week average, with 19.4 million bushels. China, Egypt, Mexico, Indonesia and Japan were the top five destinations.
Chinese customs data showed that the country’s soybean imports totaled 311.6 million bushels in April. Of that total, 59% was sourced from Brazil (174.5 million bushels) and 39.3% was sourced from the United States (122.4 million bushels). The remaining 4.7% originated from secondary sources such as Argentina and Uruguay. China is by far the world’s No. 1 soybean importer.
Soybean settlements on Wednesday were for 211,970 contracts.
Winter wheat prices suffered heavy losses
A round of technical selling that was largely tied to sinking crude oil prices tilted most contracts 1.5% to 2% lower on Thursday, incurring double-digit losses along the way. July Chicago SRW futures slumped 13 cents lower to $6.4750, with July Kansas City HRW futures down 11.75 cents to $6.87.
Wheat exports captured 6.1 million bushels in old crop sales and 4.8 million bushels in new crop sales for a total of 10.9 million bushels. Old crop sales improved 25% week-over-week and were 28% better than the prior four-week average. Analysts were generally expecting a more robust volume this week after showing trade guesses that ranged between 3.7 million and 20.2 million bushels.
Wheat export shipments stumbled 49% below the prior four-week average, with 8.5 million bushels. The Philippines, Mexico, Japan, Italy and Honduras were the top five destinations.
And finally, David Kohl, professor emeritus with Virginia Tech University, thinks both farmland values and the stock market are due for a correction – but which will fall first? “Aside from the red-hot beef industry, economic pressure is now the defining reality,” he said. “Lenders are sending letters to customers whose operating lines of credit are overdue. Accounts payable, credit card debt and restructuring requests are increasingly prevalent across the agricultural lending landscape.” Consumers are also feeling the pain right now, with car and credit card delinquencies at the highest levels since 2010. Kohl shares more of his thoughts on the matter in his latest commentary – click here to learn more.
CBOT wheat settlements on Wednesday were for 124,076 contracts.