There is talk that many traders are in disbelief of the USDA report numbers. This may explain, at least in part, why grains are trying to rebound after a negative report.
The 8-14 day forecast shows warmer and drier than normal conditions across parts of the Midwest, which may also be offering some support to the grain market.
Recent weakness in the US dollar is supportive to com commodity prices. The CPI data showed an easing of inflation, and demand for food and fuel may increase.
About 64% of the US corn crop is still said to be experiencing drought conditions.
CONAB raised their estimate of Brazilian corn production to 127.8 mmt (vs 125.7 previously).
After a higher overnight trade, soybean futures are lower at midday. This could be the result of profit taking after yesterday’s recovery.
China has been an active buyer of Brazilian soybeans for May-July 2024. They have also purchased some from the US Pacific Northwest.
CONAB reduced their estimate of Brazil’s soybean production to 154.6 mmt (vs 155.7 previously).
The expectation for June NOPA soybean crush comes in at 170.568 mb. That would be down 4.1% from May, but that is expected due to seasonal downtime for maintenance and repairs. The actual NOPA data will be released on Monday.
About 57% of the US soybean crop is said to be experiencing drought conditions.
India is reportedly banning rice exports because of shortages. They normally export about 18 mmt of the world’s 55 mmt. This has led to some thought that they will need to import wheat, as it is the next food staple in line.
The forecast looks mostly dry for the Dakotas and Minnesota over the next couple weeks, which may affect spring wheat crop ratings. Spring wheat areas of Canada are also too dry.
The Black Sea Grain Initiative expires on Monday. If an agreement for an extension is not reached, world supplies could tighten. Russia has come out and said they are willing to extend the deal if they are let back into the SWIFT banking program.
Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.
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