Closing Market Report- 5/5/21- Grains Continue Higher; Money Focus Shifting to New Crop

July contracts of corn and all three wheats closed higher Wednesday with ongoing support from dry conditions in central Brazil and the northwestern U.S. Plains. July soybean oil posted a slight loss, one of the few on the commodity board early Wednesday afternoon.

Now, it looks like the tide is beginning to turn, with new-crop corn and soybeans taking over the bullish leadership, as weather issues both here and in Brazil dictate that we need sharply higher acres. Also, rumors are floating about China possibly buying as much as 1.5 mmt to 2.5 mmt of U.S. corn for the fall (unconfirmed). New highs are being seen in July and December corn as well as in November soybeans.

The USDA reported a few new sales early on Wednesday: 184,100 mt (7.25 mb) of corn for 2021-22 sold to Mexico, 147,230 mt (5.8 mb) of corn sold to unknown, with 1.8 mb of that for 2020-21 and 4 mb for new crop 2021-22. A cancellation of a previous purchase of 2020-21 corn by China of 140,000 mt (5.5 mb) was also reported.

The lean hog contracts are keeping with their upward surge, but we’re seeing a change of tune in the cattle complex as the corn market traded mostly steady for a bit on Wednesday, which helped alleviate some of the pressure on the cattle contracts and allowed them to hold higher on the day. The cash cattle market is quiet following Tuesday’s modest movement and it’s looking like the week’s prices could be fully established at this point.

Farm and Ranch Director Jesse Allen has our closing update: https://lightningstream.com/ajax/GetODFile.ashx?call=MIDWEST&fileid=1406

Also, get analysis with Jesse Allen and Mike Zuzolo of Global Commodity Analytics on today’s episode of Market Talk: