Markets are higher off a forecast of lower rain totals for Argentina next week, plus crude oil is up significantly lending strength to corn and bean oil. Corn is currently up 4 while soybeans are up 9.
Rain coverage and amounts are expected to be lighter for Argentina next week. Forecast totals are for .12-1.25 inches and coverage of 50-60%. Brazil will see scattered showers of .5-1.5 inches during the same period. Some heat is forecast at the tail end of the models for Argentina and Southern Brazil.
Yesterday’s export sales report featured corn sales that came in towards the high side of expectations while soybeans sales fell towards to low end of expectations, a reversal of what we have become accustomed to this year. Regardless, corn sales remain solidly behind the pace needed to meet the USDA’s annual estimate. Corn sales are 243 mbu (13%) behind the USDA’s projected pace. Cumulative soybean sales are 165 mbu (8%) ahead of pace. The USDA did not touch export demand for either commodity in this week’s WASDE report, but I think they will have to address the growing gaps in both corn and soybeans sometime this spring.
This market has and will continue to struggle to move higher with the lack of demand and a South American crop that is starting to come off. Aside from spring US planting delays, we will continue to trade sideways in the next couple months.
Have a Safe Day!