Stronger markets to start the day. Corn is up 3 and soybeans are up 6.
Weekly exports had another decent week with corn coming in at 35.8 million bushels and soybeans at 42.1 million bushels. Despite the decent numbers, corn is still 235 million bushels behind the USDA’s projections for this year.
Trader’s are expecting big things from China as their economy reopens for the first time in three years. Additional demand for food and energy are believed to be the driving force. Index funds have been buyers which has put crude oil at the top of the recent range.
A USDA attaché in Beijing said that China is set to import “a substantial amount” of Brazilian corn in calendar 2023, without giving an exact number; imports are priced competitively with local supplies, despite a strong 2022 harvest in the North China Plain. End users are mixing more corn in feed rations due to higher prices for wheat and sorghum. China has only bought 3.7 mmts of US corn this year, down 70% from last year. Brazil will have as much as 50 mmt of corn for export if crops sizes stay large.
Mexico’s Deputy Ag Minister yesterday said the country’s goal is to reduce yellow corn imports by 30-40% by 2024. Mexico buys 16 mmt of US yellow corn from US exporters. Sometimes Mexico is the US’s largest export customer taking 600 plus million bushels.
Producers should take advantage of any small rallies to unload old crop corn. We need something bad to happen with weather in South America for corn to push above $7. I look for the markets to ease lower late today and tomorrow.
Have a Safe Day!