Jim Warren

May 3, 2021

Highlights

Grains started the month of May with a shot of volatile trading on both sides of unchanged in most markets.  Continued concern about SAM dryness coupled with a fast week of planting allows differing market opinions to feed that volatility. 

  • China is celebrating their national Labor Day holiday and their markets will be closed through Wednesday.
  • A shortage of truck drivers has some analysts predicting gasoline shortages and higher prices this summer.
  • The CME Group launched a Lithium Hydroxide futures contract today, aimed at the risk management of lithium supplies used in batteries.
  • Increased daily price limits took effect today but were not tested in the grains.
  • Dow Jones futures currently up 272 at 34039, US$ down 0.308 at 90.972, and Crude Oil up $.87 at $64.45.

Corn

A surge higher overnight gave us new contract highs in the July contract, but other contract months turned negative during the day session and closed well off their highs with slight losses.  A continued dry forecast for Brazil’s Safrinha corn area is keeping support in this market.

  • Closes: July at $6.79 ½ , up 6 ¼ cents, December at $5.63 , down ¾ cents.
  • USDA reported 46% of the corn crop is planted, well above the 36% average for this date.  The average estimate was 44%.
  • Export inspections were a strong 2.139mmt last week for corn, at the top end of estimates.
  • Spreads: N/U 88 inverse, up 7 cents today; U/Z 29 ¼ inverse, up ¾ today and Z/H 5 carry, down ¼ .

Oilseeds

Soybean Oil and Canola both made new contract highs in the first 4 contracts, but the rest of the oilseed complex did not, and in fact faltered after the 8:30am opening to the day session. 

  • Closes: July at $15.24, down 10 ¼ cents, November at $13.44 ¾ , up 5 cents. July meal was down $11.00 and July oil was up .67 cents.
  • 24% of the crop is planted, compared to 11% on average.  The average guess was 25%.
  • Todays Fats and Oils report estimated 188mbu of soybeans were crushed in March, in line with estimates.
  • Soybean export inspections were only 143tmt, below estimates and also below the average weekly amount needed to meet USDA’s projection.
  • Gulf basis for June was up 15 cents to +110N.
  • Spreads: N/Q 56 ½ inverse, down 6 ½;  N/X 181 ½ inverse, down 13 and X/F 1 ¼ cent inverse, unchanged.

Wheat

Wheat in KC and Chicago had the biggest moves in the grains today, with weakness on recent rains and expected improving conditions.  Paris futures were also lower today.  Spring wheat planting progress advanced sharply last week. 

  • July closes: Mpls at $7.58 ¾ , down 5 cents, KC at $6.88 ½ , down 15 cents, Chicago at $7.18, down 16 ¾ cents.
  • The winter wheat crop is rated 48% Good/Excellent, down 1 from last week, as of Sunday night.  27% is headed, a little behind the average of 34% for this time period.
  • Spring wheat is 49% planted, compared to the 5 year average of 32%.
  • Export inspections were 509tmt, below last week’s amount but about what was expected.
  • Strength in the KC Spot lower proteins brings the whole schedule to a level 145 to 155 bid.
  • There were 200 wheat deliveries in Chicago, 52 in MPLS and 5 in KC from Friday.  Any new deliveries will be announced later this evening.
  • Spreads: Mpls N/U 3 ¾ cent carry, Kansas City N/U 5 carry, Chicago N/U ¼ cent inverse.