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Afternoon Market Recap for April 25, 2017

Wet forecast looms for corn planting.

April 25, 2017

Soybeans wilt after fast start to planting

Corn futures closed at a one-week high as traders apparently looked ahead to the storms forecast this week that may sideline planters for a few days. The gains in futures occurred despite the weekly USDA report that showed better-than-expected planting progress last week. 

Soybeans retreated a little from yesterday’s double-digit gains as planting is off to a quick start, although most of those fields are in the south.

A weak dollar and some planting concerns along the northern border helped wheat with winter wheat closing higher after contract lows earlier. Spring wheat had the best gains of the three wheat markets. 

Crops may have benefitted from some spillover support from Wall Street, which sped higher again on optimism the favored French candidate will win the May 7 election. The Dow industrials were up more than 250 points when the crops closed. French centrist Emmanuel Macron is the favorite over far-right candidate Marine Le Pen. It has been forecast that a win by Le Pen, who opposes immigration and a unified Europe, would shake up world markets.

Exports – USDA, Reuters:

  • Turkey bought 44,000 metric tons of corn from either the European Union or Moldova. Shipment is for April 28-May 10.
  • Israel seeks to buy up to 100,000 metric tons of corn, 45,000 of feed wheat and 30,000 of feed barley from optional origins. The tender closes on Wednesday. Shipment would be this summer with dates determined by origin of the grain.
  • A Taiwan group seeks to buy 40,000 to 65,000 metric tons of corn to be sourced from the U.S., South America or South Africa. The tender closes on Wednesday with shipment for July.
  • Tunisia seeks to buy 67,000 metric tos of optional-origin milling wheat. The tender deadline is Wednesday with shipment for June 25 to August 5.
  • Iraq seeks to buy 50,000 metric tons of wheat from the U.S., Canada or Australia. The tender closes May 7.
  • China imported nearly 6.33 million metric ton of soybeans in March, up 3.73% from a year ago. From the U.S. it bought 4.22 million, down 7.66% from a year ago. However, year-to-date buys from the U.S. are up 17.8% at 15.43 million tons.

 

Corn futures closed about 6 cents higher and at a one-week high as forecasts have rain, severe storms and flash flooding for parts of the Midwest on Wednesday.

In addition the seven-day and 6- to 10-day forecasts keep rain in the Midwest along with cooler weather. Those forecasts offset the pressure that was expected after Monday’s better-than-expected planting pace of 17%.

The CBOT estimated Tuesday’s volume at 634,553. Monday’s actual volume was 479,056. Open interest in Monday’s higher market decreased by 487 with May’s down 30,465 and July’s up 25,440. 

May corn closed up 5-3/4 at $3.65, July rose 6-1/4 to $3.71-3/4. New-crop December rose 5-1/2 to $3.89. 

What to Look For: Attention remains on the weather and how much planting can be done. May 15 looms large in many farmers’ minds as planting after that can affect yields, particularly in the northern areas of the western corn belt.

 

Soybeans dropped nearly 7 cents following better-than-expected planting of 6% in Monday’s progress report. However, most of the planting was in the south, although Illinois and Indiana did get into a few fields last week.

Soybeans lacked support from soymeal, which dropped nearly $3 a ton today after it closed higher yesterday.

Planting delays have been a concern for Canada’s canola and had pushed that market higher. Old-crop canola months were lower today after recent gains, but the new-crop months were higher again. Last week, Statistics Canada said farmers there are expected to plant nearly 10% more canola and 27.2% more soybeans. The expected 22.4 million acres of canola and 7 million of soybeans would be records.

The CBOT estimated Tuesday’s soybean volume at 231,638. Monday’s actual volume was 276,339. Monday’s open interest decreased by 17,439 in the higher market with May’s down 28,403 and July’s up 10,243. November’s open interest increased by 840. 

May soybeans closed down 6-3/4 at $9.54-1/2 per bushel and July dropped 6-3/4 to $9.65. New-crop November dropped 5-3/4 to $9.61-3/4.

What to Look For – Financial and equity markets have been garnering headlines and attention. The May 7 French vote looms large and, depending on the results, could send tremors through a number of markets including commodities.

 

Wheat market recovered from yesterday’s drops to close higher with help from the lower dollar, which drew pressure from the strong euro.

Spring wheat had solid gains amid concerns of late planting along the northern border. South Dakota is the only spring wheat state with significant progress. North Dakota, the top producer, is at 2% planted versus the 4% average as winter has been slow to depart that state.

CBOT estimated Tuesday’s SRW volume at 205,110, compared with Monday’s actual volume of 146,042. Monday’s open interest decreased by 2,468 in the lower market with May’s down 10,847 and July’s up 9,351.

Chicago’s May soft red winter wheat closed up 6-1/4 at $4.08-3/4 and July up 7-3/4 at $4.27. Kansas City’s May hard red winter wheat rose 10-1/4 to $4.12 and July rose 10-1/2 to $4.24-3/4. Spring wheat for May rose 12-1/4 to $5.33-3/4 and July was up 13 at $5.44-1/2.

What to Look For – Winter wheat is doing fairly well because of the recent rain. Spring wheat is being watched as winter-like conditions have slowed planting.

More from Farm Futures:

Weekly Corn Review
Weekly Soybean Review
Weekly Wheat Review

 

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