Jim Warren

May 4, 2021

Highlights 

Grain markets generally had a higher trend today, but did have a mid-morning pullback before re-gaining strength.  Cattle felt pressure from higher corn prices, while hogs made some gains today. 

  • China is celebrating their national Labor Day holiday and their markets will be closed through Wednesday.
  • The 6-10 and 8-14 day NOAA outlooks call for cool/wet conditions over much of the growing belt for that period.
  • Dow Jones futures currently down 107 at 33901, US$ up 0.338 at 91.283, and Crude Oil up $1.22 at $65.71.

Corn

The July contract made a new high today, and the new crop December contract followed along despite the fast planting pace, with the N/Z spread only losing a penny today.  Corn prices are above $5 all the way out to the July 2023 contract now.

  • Closes: July at $6.96 ¾ , up 17 ¼ cents after making a new contract high of $7.04, December at $5.80 ½ , up 17 ½ cents.
  • A Brazillian analyst estimated their ethanol exports will be down 24% this year, due to drought-reduced sugar and corn crops.
  • Nearby ethanol futures settled up 11 cents yesterday, at $2.44/gallon, and remained at that level today.
  • Russia is suspending buckwheat exports from June 5th to August 31st in another move to limit food inflation there.
  • Spreads: N/U 86 inverse, down 1 ¾ cents today; U/Z 29 ¼ inverse, up ½ today and Z/H 4 ¼ carry, up ½ .

Oilseeds

The soybean complex was higher on the day, following through on the bullish Fats and Oils report yesterday. 

  • Closes: July at $15.38 ¼ , up 14 ¼ cents, November at $13.63 ¼ , up 18 ½ cents. July meal was up $6.40 and July oil was up .52 cents.
  • Brazil exported a record 17.38mmt of soybeans in April.  Their May lineup is about a third smaller currently.
  • Funds were estimated to have bought 9,000 contracts of soybeans today.
  • Spreads: N/Q 56 ½ inverse, down 3/4 ;  N/X 175 inverse, down 4 ¼ and X/F 1 ¾ cent inverse, up ¾ .

Wheat

Wheat prices were higher in all 3 classes and also in nearby Paris futures, which were up about 25 cents/bu when adjusted for the currency difference.  

  • July closes: Mpls at $7.68 ¼ , up 9 ½ cents, KC at $6.99 ¼ , up 10 ¾ cents, Chicago at $7.26 ¾ , up 8 ¾ cents.
  • Sovecon raised their estimate of Ukraine’s wheat crop 800tmt to what would be a record 28.6mmt.
  • July KC wheat traded to a 4 ¼ cent discount to July corn during today’s session, but settled at a 2 ¾ cent premium.
  • Spreads: Mpls N/U 4 cent carry, Kansas City N/U 4 ¾ carry, Chicago N/U ¼ cent inverse.