Morning Comments May 13, 2021

Corn closeup

Our markets have cooled off as the trade works through yesterday’s fresh data from the USDA. Overall the report was slightly bearish (negative) to our markets and that touch of weakness was all it took for us to take a true step back in price for the first time in a while.

In general, the USDA moved everything in the right direction for old crop corn, showing reductions in the corn carryout for the end of this summer (as expected) while leaving beans unchanged at an already paper-thin carryout of 120m bushels. Nothing to see here, so please move along. As for new crop? Global production for next year was a little larger than expected and the US corn carryout for next year also came in a touch high at 1.5b bu. Hence, the selloff. Of course, the bulls in the room will quickly argue and point to the fact that the USDA is using a record US corn yield (179.5 bpa) for next year and 1.5b bu. is the lowest starting carry out we’ve seen in a decade... So, time will tell who wins this one. The weather maps across the globe will have the most say in that argument (as will the final planted acreage report on June 30th).

For today, both our corn and soybean markets are following through with double-digit lower moves. As I type this, nearby July corn futures have slipped under that psychological support level of $7.00 -- it will be interesting to see if the market can claw back to that number of higher by day’s end.

Currently

Corn is 10 to 18 cents lower

Soybeans are 15 to 20 cents lower

May 13 Graphic 1
May 13 Graphic 2