Written Commentary
Global Ag News for Mar 25.24
March 25, 2024
SOYBEANS
Soybean futures traded higher after USDA estimated US 2021 soybean crop lower than the traded expected. Rating was still above average. A couple of hedge funds increased longs in soybeans betting that on Monday the 2-3 week US Midwest forecast will be warm and dry. US 2021 soybean acres will need to increase from USDA March guess and yield will need to be record high to satisfy demand and keep prices from going higher. There is also talk that later this month, China may begin to start buying US new crop soybeans. Some estimate that China could buy 40-44 mmt US soybeans in 2021/22 vs 35 this year. Most do not expect USDA to make big changes to US/World soybean supply and demand on Thursday. Adverse US summer weather will be needed to push futures higher. There is talk that US soybean crushers may have good ownership through August.
CORN
Corn futures traded higher but ended off session highs. Market continues to be afraid of buying corn near current levels especially if US summer weather is normal. The problem is the long range US weather maps still point toward warmer and drier weather for the upper US Midwest and plains. This could be the key point in this years price discovery. Rains and we are near the top. Continued dryness and we trade higher. This week, some analyst feel that if the summer is warm and dry nearby corn futures could test the Oct, 2008 high near 8.44. USDA dropped the US corn rating to 72 pct good/ex. This was more than expected. Continued dry/warm upper Midwest weather could lower next Mondays ratings. This could push futures higher. USDA rated the ND crop 42 pct good/ex and SD 46 pct. These 2 states are 10 pct of US corn acres. Some feel USDA should increase US 2020/21 and 2021/22 corn demand on Thursday. This should lower both years carryout. Question is, is that already in prices? Trade feels China will take open unshipped US corn exports and could take 30-32 mmt US corn in 2021/22 vs 23 this year. Trade will also be watching to see if they lower Brazil corn crop and increase US exports. Some est of the Brazil crop are now as low as 85-87 mmt vs USDA 102.
WHEAT
Wheat futures were mixed. WN and KWN traded higher and followed the higher traded in corn and soybeans. MWN traded lower as rains moved across parts of the US north plains and Canada prairies. Some feel that the long range maps suggest that summer weather could be warm and dry. There has been some talk that the final US 2021 HRS crop could be closer to 430 mil bu vs current est of 505 and 530 last year. This could help US HRW basis/prices. Talk that US KS 2021 protein could drop below 12 oct could also firm 12.0 pct protein basis. USDA rated the US HRS crop 38 pct good/ex vs 82 last year and the lowest since 1988. USDA also rated the US winter wheat crop 50 pct good/ex vs 48 last week. Gains were made in HRW and SRW and white wheat dropped. There is new concern that later in June, Russia weather might suggest a hot and windy conditions which could stress crop there.
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