Written Commentary
March Madness continues. Soybeans, soymeal and corn traded lower. Soyoil and nearby Chicago wheat traded higher. Quarter end and pre USDA report liquidation continues to offer resistance to corn and soybeans. US stocks turned higher. US Dollar was higher. Crude was higher. Gold was lower.
SOYBEANS
Quarter end and pre-USDA report liquidation continues to offer resistance to soybeans. Advancing Brazil soybean harvest, slowdown in weekly US soybean exports and uncertainty over USDA estimate of US March 1 soybean stocks offered resistance. Brazil soybean harvest is near 71 pct done versus 76 last year. There is also talk that favorable weather could increase US final 2021 corn acres and lower soybeans. Last year, USDA est of March corn acres were near 97.0. Final acres were near 90.9. Trade estimates US 2021 soybean acres near 90.0 versus 83.1 last year. Range of guesses is 86.1-91.6.There is also concern that USDA could find bushels on the March 31 stocks guess. Trade est stocks near 1,534 mil bu versus 2,255 last year. Range of guesses are 1,440-1,825. 1,440 could suggest a 20 cents rally while 1,825 could suggest a 20 cent break. Weekly US soybean exports were near 15 mil bu. Season to date exports are up 829 mil bu vs USDA guess of a 548 increase. Soyoil gained on talk of increase end user buying.
CORN
Corn futures traded lower. Managed funds continued to reduce their net long before USDA acreage and stocks report. Last year, USDA March guess for acres were near 97.0 with final acres near 90.8. Wet spring increase prevent plant acres especially in NW. 97.0 million acres could reflect farmer good cash position and willingness to increase acres to increase potential income. Last year, US net farm income was up but mostly due to Covid payments. Payments this year could be less. Trade estimates US 2021 corn acres near 93.2 with a range of 92.0-94.5. There is also some fear that USDA could find bushels on their March 1 stocks. Over last 16 years, stocks have been above trade guess 10 times an average of 137 mil bu and below 6 years 141 mil bu. Key could be quarterly feed and residual. Most est feed 1,345 mil bu. recent range has been 1,191-1,528. FSI is est near 1,514 vs 1,712 ly and exports 670 vs 355 ly. Weekly US corn exports were near 66 mil bu. Some look for exports to average 69 per week with final exports near 3,000 mil bu versus USDA guess of 2,600. Season to date exports are 613 mil bu above ly versus USDA guess a 772 increase. Brazil corn crop is 98 pct planted. Weather remain dry.
WHEAT
Wheat futures managed small gains before USDA report. Some feel managed funds could be liquidating short wheat futures and short wheat spread before quarter end and USDA report. Most so not look for big surprises in the wheat numbers but wheat futures have seek steep losses from Feb 24 high and could be oversold. Most look for weekly USDA weekly winter wheat crop ratings to improves from last week but 2 week weather forecast is dry. Crop will need to see additional rains to insure above average yields. Trade is looking for US 2021 all wheat acres near 45.0 versus 44.3 ly. Winter wheat 31.8 versus 30.4 last year. Spring wheat 11.6 versus 12.2 last year. Concern is that north plains weather could be drier than normal. Trade est March 1 wheat stocks near 1,272 mil bu versus 1,415 last year. Quarterly food use is est near 237 mil bu vs 236 ly, feed -18 vs -19 last year and exports 211 vs 235 ly.
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