We saw the demand surge continue overnight with grain markets shooting higher. May old crop corn is now over $7 on the board while May old crop soybeans are over $16. This market continues to surge higher on fund buying, supply and demand issues and weather worries. There really seems to be no top in sight as we push forward this week. Tuesday has an index of U.S. consumer confidence set for 9 a.m. CDT, but no other official reports. Traders will keep a close eye on the latest weather forecasts and watch for any export sales news.
On China’s Dalian exchange, quotes were unavailable. July common wheat on China’s Zhengzhou exchange was down 0.4%. June Malaysian palm oil is trading up 3.8%.
May’s roughly 39-cent premium over the July contract is higher than it was this time of year in 2012 and 2013 and continues to show how strong commercial demand is for the tight remaining supplies of corn. This is also the first time spot corn has traded above $7.00 since 2013. Late Monday, USDA said 17% of the corn crop was planted, a little below the five-year average of 20% for this time of year. Kansas, Nebraska and Missouri were all slower than their usual planting paces, slowed down by last week’s colder temperatures. The concern of the moment is in Brazil where the young second corn crop is dry and the seven-day forecast is also mostly dry with pollination approaching.
May soybeans are holding a premium of roughly 32 cents over the July contract. There are concerns that the current surge of coronavirus cases in India will slow demand from the world’s largest importer of vegetable oil, but as we can see early Tuesday, traders seem to have no concerns about the situation. Late Monday, USDA said 8% of the soybean crop was planted, above the five-year average of 5% for this time of year. Southern states especially, have been pushing out early, trying to earn a bonus from higher prices for early harvest in 2021. The overriding concern of the market of course, is that U.S. soybean supplies remain historically tight and it does not appear that Brazil’s record soybean harvest has done anything to slow China’s demand.
For spring wheat, USDA said 28% of the crop was planted as of April 25, above the five-year average of 19% for this time of year. 7% of spring wheat has emerged, up from the five-year average of 5% for this time of year. Helped by dry weather, 22% of North Dakota is planted, up from the five-year average of 10% for this time of year. The spring wheat crop will need rain at some point however and the seven-day forecast is mostly dry for the northwestern U.S. Plains.
Farm and Ranch Director Jesse Allen has the latest: https://lightningstream.com/ajax/GetODFile.ashx?call=MIDWEST&fileid=650
