Morning Comments April 7, 2021

Soybean Field Wsign

The markets are slightly higher at the morning pause in fairly light trade ahead of Friday’s WASDE supply/demand report. Increases are expected in corn export demand and possibly ethanol corn demand, which would lower ending stocks to around 1.3 billion.

Although market fundamentals are bullish, there are a couple of macro issues that could present significant headwinds. The first is related to COVID, as strains may expand stay-at-home orders thus far, mainly in Europe and South America. The Ontario province in Canada enacted a 30-day lockdown starting tomorrow. The second headwind is related to ASF in China. 20% of their sow herd has perished in their northern agricultural area. The main risk is containing the virus there, so it doesn’t spread to the southern areas. Memories are still fresh of the severe ASF outbreak in 2018-2019 that culled 40% of the entire China swineherd. 

Weekly EIA ethanol data will be out today; production might begin to dip as we enter spring plant maintenance season. Weekly export sales will be out tomorrow morning. 

In the U.S., Midwest weather is good with rain this week followed by 7-10 days of cool/dry conditions. 

Opening Calls:

Corn: up 2-3c

Beans: up 2-3c