Weather risks seen as less severe now that 92% of the crop is planted
On the heels of Monday afternoon’s USDA crop progress report, corn eased more than 1% today after the agency reported nearly all of the crop is finally in the ground. Wheat prices also slumped on some technical selling and spillover weakness from corn, while soybeans hung on for fractional gains, as more than one-fifth of that crop still remains to be planted.
Don’t look now, but another 3” or more rainfall could hit large parts of the Corn Belt this coming week, according to the latest seven-day cumulative precipitation map from NOAA. Areas with the most rainfall potential through June 25 include eastern Kansas, Missouri, Illinois, Indiana, Ohio and Kentucky. Daytime highs should clock in below normal at least through this weekend into early next week.
President Donald Trump confirmed he will be meeting with Chinese President Xi Jinping at the G-20 Summit later this month, which infused a fresh round of optimism on Wall St. The Dow moved 384 points higher this afternoon to 26,497. Energy futures also moved sharply higher on hopes U.S.-China trade talks will resume, with crude oil picking up nearly 4% to almost $54 per barrel, with gasoline and diesel also making significant gains this afternoon. The U.S. Dollar firmed slightly.
Corn prices fell on a round of profit-taking now that most of the 2019 U.S. crop has finally been planted. July futures fell 5 cents to $4.4975, with September futures down 6 cents to $4.5550.
Corn basis bids were steady to mostly firm Tuesday, moving as much as 10 cents higher at an Indiana ethanol plant today. More common increases of 2 to 4 cents were seen elsewhere across the central U.S.
Corn planting progress improved from 83% the prior week up to 92% complete as of June 16, according to USDA’s latest crop progress report, out late Monday afternoon. Still, that progress failed to match 2018’s pace and the prior five-year average, both at 100%. Among planted acres, 79% of the crop is now emerged, up from 62% a week ago but well behind 2018’s pace and the five-year average, both at 97%.
Corn condition held mostly steady, with 59% rated in good-to-excellent (unchanged from last week). Another 31% of the crop is rated fair (down from 32% last week), with the remaining 10% rated poor or very poor (up from 9% last week).
Brazilian consultancy Agroconsult has again raised its estimates for the country’s 2018/19 corn production, now at a projected 3.984 billion bushels. Agroconsult also sharply increased its estimates for 2019 Brazil corn exports, now at 1.496 billion bushels.
Preliminary volume estimates were for 452,582 contracts, retreating 39% below Monday’s final count of 745,605.
Soybean prices found some light technical buying but were pressured overall by spillover weakness from corn. Still, prices ended Tuesday’s session slightly in the green, with July futures up 0.75 cents to $9.1350 and August futures up a penny to $9.2025.
Soybean basis bids were mixed at Midwestern processors Tuesday but held steady across most other interior locations today.
In yesterday’s USDA crop progress report, analysts expected the agency to show 79% of the crop was now in the ground, but the agency’s official tally came in lower than that, at 77% completion. That’s up from the prior week’s tally of 60% but still far behind 2018’s pace of 96% and the five-year average of 93%.
Soybean emergence has progressed to 55%, improving over the prior week’s 34% but still far behind 2018’s pace of 89% and the five-year average of 84%.
Brazilian consultancy Agroconsult increased its estimates for the country’s 2019 soybean exports by 5.2% in March, now at 2.590 billion bushels.
Preliminary volume estimates were for 275,661 contracts, falling moderately below Monday’s final count of 344,194.
Wheat prices saw moderate to significant losses Tuesday on some technical selling prompted by spillover weakness in corn, with overseas competition applying additional headwinds. July Chicago SRW futures dropped 8 cents to $5.3150, July Kansas City HRW futures fell 10.75 cents to $5.3150, and July MGEX spring wheat futures were down 8 cents to $5.5225.
The 2018/19 winter wheat crop prepares for harvest, meantime, with 89% of the crop now headed, according to the latest USDA crop progress report. That’s slightly behind 2018’s pace of 94% and the five-year average of 95%. Harvest is now 8% complete, up from 4% the week prior but bucking analyst expectations of 10%.
USDA also held crop quality ratings mostly steady, with 51% of the crop in good condition and 13% rated excellent (versus 50/14 last week). Another 27% of the crop is rated fair, with the remaining 9% rated poor or very poor – all unchanged from a week ago.
Spring wheat crop quality took a dip, however – with 77% of the crop now rated in good-to-excellent condition, versus 81% a week ago. Physiologically, 95% of the spring wheat crop is now emerged, up from 85% a week ago and slightly behind 2018’s pace and the five-year average, both at 97%.
Australia cut its 2019/20 wheat export forecast by more than 18%, due largely to ongoing drought concerns in some of the country’s major production regions. The latest estimates are for 429.9 million bushels for the world’s No. 4 wheat exporter.
Japan made offers to purchase 2.3 million bushels of food-quality wheat from the U.S. in a regular tender that closes Thursday.
Preliminary volume estimates were for 127,063 CBOT contracts, falling 23% below Monday’s final count of 165,736.