Corn: Up 2 to 3
Soybeans: Up 2 to 3
Corn is trading higher this morning with crude oil trading steady and yesterday’s progress report indicating that most of the corn crop will be planted by Memorial Day. On the bullish side, corn exports have been strong, running slightly above the 41 million bushels/week needed through the end of August in order to reach the USDA number of 1.775 billion bushels. Ethanol margins are also in the black with the strength in crude oil and an improving global economy. Recent wet and cold weather and some flooding are also points that bulls are hanging their hats on. On the other side, bears are quick to point out 3.3 billion ending stocks, the fact that with the economy reopening it will be a few weeks before we can gauge any spikes in corona cases, and South America receiving some rains and planting progress being ahead of the five year average as being reasons that any market rallies will fall short.
On soybeans, bulls are pointing to a few more purchases by the Chinese and their first U.S. purchase of bean oil in a few months. This combined with talk that the Chinese have asked domestic importers and food processors to increase surplus ahead of what could be larger coronavirus related logistical problems are giving the bulls hope. The bears are looking at the previous eight weeks of exports being below the pace needed to hit the USDA number of 1.675 billion bushels and see the Chinese news regarding importers and food processors as China knowing something the rest of the world doesn’t yet.
Rallies on corn or beans should be looked at as marketing opportunities, talk with your local GMA on marketing strategies on both old and new crop to take advantage of the several marketing strategies we offer to help you add to your bottom line.