Grains were higher overnight trying to recover some of Tuesday’s steep sell-off.
Yesterday after the market close, USDA’s crop progress data showed weaker than expected corn and soybean ratings. The US corn crop was rated as 65% good-to-excellent vs 68% expected while winter wheat ratings slipped 2% on the week to only 50% good-to-excellent. For spring wheat, the crop was rated at a sub-bar level of 62% good-to-excellent versus expectations of 71% going into the report. For planting, both corn and soy plantings were off the expected pace by only 1% with corn at 91% completed and soybeans at 67%.
Soy crushing margins in China are at 3-year lows, which is forcing some buyers to try and cancel shipments. Losses on the margin are around $43/MT. China was a heavy buyer from Brazil at the beginning of the year and lower prices following bumper harvests. But those profits have swung to the biggest losses in nearly three years after China's edible oil markets were flooded with rapeseed oil auctioned from national reserves and by growing imports of other alternative vegetable oils.
Egypt’s GASC issued a tender to buy wheat. The last Egyptian tender saw US garner some business for the first time in two years after the GASC upped their protein requirements. A South Korea feed group was also tendering for 140,000 MT of corn.
In weather, longer-term forecasts for the US in June and into July see no major threats to crop growing regions. June is expected to remain slanted towards cool temps and active moisture patterns. The only regions expected to be on the dry side are the high Plains of Western ND/Eastern MT. Some heat and dryness could materialize in the Eastern Cornbelt, but with high soil moisture values right now in much of the grain belt, meteorologists suggest that should put a downward bias in temps over the next few months.
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