Corn is beginning the day slightly lower, this seems to have been the trend as of late. Prices have generally worked higher over the past two weeks which has resulted in a 36-cent move off of the low on the May contract so far.
Brazil’s Conab cut 23/24 corn production by 944,000 tons to come in at 112.8 mmt in their March estimate this week. If realized this would be a 14.5% drop in corn production year over year for Brazil.
Extended forecasts for Mato Grosso, Brazil’s largest second crop corn state, are pointing to drier and warmer than normal. These forecasts, if verified, would likely trim production estimates.
The ethanol industry has thrived in the first half of the 23/24 marketing year with corn consumption running 5.9% above the long-term average. Ethanol margins remain strong across the Corn Belt but ethanol stocks are approaching near record levels.
Soybeans are lower this morning after yesterday’s strong move higher. From the 2/29 low to yesterdays high May soybean futures had rallied 68 cents. Soybean meal is lower this morning while soybean oil is higher.
Brazil’s CONAB lowered their soybean production estimate by another 2.5 mmt to come in at 146.9 mmt. Their estimate is now 8.1 mmt (297 mb) lower than the USDA estimate for the 23/24 Brazilian soybean crop.
World vegetable oil prices have been stronger over the last two weeks with palm oil leading the gains due to lower production and lower stocks in southeast Asia.
Intense rains in Argentina are creating excess soil moisture and could hinder soybean harvest progress if the rains carry into April. The moisture is seen as very beneficial to the 24/25 wheat crop.
All three wheat classes are trading lower this morning following the lower trend in corn and soybean prices.
Tuesday’s trade in Chicago wheat saw prices rally off of a lower start. Prices remain under the influence of Monday’s key reversal but below the February low near $5.53-1/2.
A push of moisture from the Gulf of Mexico and abnormally warm temps should cause a few rounds of thunderstorms with good rain amounts to fall across the heart of the US over the next week helping to improve soil moisture levels.
Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.
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