By MATT PIKE
St. Joseph Post
GENERAL COMMENTS:
May corn closed up 9 cents and December corn was up 3 1/2 cents. May soybeans closed up 16 1/4 cents and November soybeans were up 7 3/4 cents. May KC wheat closed down 10 cents, May Chicago wheat was down 4 1/4 cents, May Minneapolis wheat was down 6 3/4 cents.
The U.S. Dollar Index is down 1.99 at 100.91. The Dow Jones Industrial Average is down 845.0 points at 39,991.0. June gold is up $111.10 at $3,190.50, May silver is up $0.69 at $31.10 and May copper is up $0.1870. May crude oil is down $1.93 at $60.42, May ultra-low sulfur diesel is down $0.0578, June RBOB gasoline is down $0.0685 and May natural gas is down $0.286.
CORN:
May corn futures closed up 9 cents to $4.83 on Thursday. New-crop December futures were up 3 1/4 cents to $4.54 1/4. May corn was able to extend its winning streak to five sessions and in the process secure a close back above the 50-day moving average at $4.78 1/4. This is the first close above the 50-day moving average since Feb. 26. Given the sharp decline in prices seen in late February, the chart left little in the way of clear short-term support and resistance; so, at this point the $5.00 mark becomes the clear bullish target for corn traders moving forward.
The USDA at long last increased its estimate of corn exports in Thursday's WASDE report. Increasing the forecast from 2.45 billion bushels (bb) to 2.55 bb. The USDA did offset this with slightly less feed demand expected, likely stemming primarily from the surprisingly low hog numbers estimated by the USDA in the most recent quarterly Hogs and Pigs Report. Focusing on exports, Thursday morning's Export Sales data from the USDA kept the pace strong with commitments running 25% above 2023-24. The USDA is now penciling in an 11% year-over-year increase, so the potential for future revisions higher remains on the table.
In South American news, Brazilian agency CONAB revised its estimate of 2025 corn production higher to 124.7 million metric tons (mmt) Thursday morning prior to the WASDE release in which the USDA kept its estimate steady at 126 mmt. The next month's weather will be pivotal in the accuracy of these estimates. Meanwhile, Thursday's world corn stocks estimate shrank again by over 1 mmt, notably when not including China's stocks. This puts an increased degree of importance on safrinha corn, with the crop being the second largest source of imported corn for the world behind the U.S.
The DTN National Corn Index finished Wednesday at $4.47. Thursday's futures close and Wednesday's implied corn basis of 27 cents under the May board would indicate the index on Thursday afternoon to be near $4.56.
SOYBEANS:
May soybeans closed at $10.29 on Thursday, up 16 1/4 cents. New-crop November soybeans were up 7 3/4 cents to $10.04 3/4. May soybean futures posted a fourth straight day higher and are now within a half cent of completely erasing the tariff-induced losses from last week. Prices now sit just a penny below the 50-day moving average, a level the market has not closed above since late February. Support is seen currently near $10.15 to the downside.
Thursday's USDA data was mostly quiet for soybeans as the USDA did reduce domestic ending stocks by 5 million bushels (mb), as a result of stronger crush but offset slightly by increased imports of soybeans. I was a bit surprised by both adjustments. The crush in particular is a welcomed bullish adjustment, especially considering the somewhat disappointing crush volume seen in February. However, March is usually a strong crush month and will do a lot to dictate the pace through the balance of the marketing year. On the world side, the USDA again left South American production estimates unchanged, however there was a surprise increase to Brazilian production for 2023-24 which in turn increased Brazilian soybean stocks for this current year. CONAB Brazil did notably increase their soybean estimate in their April report Thursday morning to 167.9 mmt, closing the gap with the USDA. At this point, the argument is really just which record crop is larger as it pertains to Brazil. Lastly, Thursday's figures did include increased domestic crush in both Argentina and Brazil which likely would have resulted in a drawdown of world stocks outside of China had the USDA not bolstered beginning stocks in Brazil as a result of revising last year's figures.
The DTN National Soybean Index finished Wednesday at $9.55. Thursday's futures close and Wednesday's implied soybean basis of 58 cents under the May board, would indicate the index on Thursday afternoon to be near $9.71.
WHEAT:
May Kansas City wheat futures closed down 10 cents Thursday to $5.58. New-crop July futures were down 7 1/4 to $5.73. It was not surprising to see wheat futures retreat from daily highs following what was for the most part a bearish USDA report. KC May futures challenged their 100-day moving average at $5.75 1/2 but failed to gain a footing there. $5.50 is seen as the most significant immediate round of support for Kansas City futures.
The USDA again cut wheat export expectations in Thursday's WASDE. This time by 15 mb to now 820 mb for the season. To add to the bottom-line stocks increase of 27 mb from March, the USDA cut seed usage slightly but more notably increased imports yet another 10 mb. Wheat imports are seen to be the largest since 2017-18 as estimated, largely to do with the strong U.S. Dollar through most of the marketing season especially relative to the Canadian dollar where most of the imports are sourced. In world figures, the USDA increased world wheat stocks outside of China by just under 3 mmt. Mainly as a result of the USDA expecting less wheat trade to occur, primarily due to further reductions in Russian exports driving less imports and subsequently less domestic usage in major importing countries outside of China. Despite the bearish tone to Thursday's numbers, I remain interested to see how quickly traders turn the page on this report and return focus to weather, where between flooding in the East and dryness in the West there remains potential issues as 2025 wheat heading advances. For reference, in Thursday morning's Drought Monitor from the University of Nebraska-Lincoln, 32% of winter wheat growing area was still seen in some form of drought.