Grain and soybean futures modestly higher... Corn futures are fractionally to a penny higher after trading on either side of unchanged overnight. Soybeans are trading near session highs with gains of 2 to 3 cents. Wheat futures are up 1 to 3 cents, with the SRW and HRS wheat markets leading gains. The U.S. dollar index is again under pressure, while crude oil futures are slightly higher.
USDA Secretary Perdue to appear at House hearing today... USDA Secretary Sonny Perdue will provide the House ag panel with an update on the state of the rural sector. Panel members will likely ask him about the recently announced USDA reorganization, with some lawmakers disagreeing with that they believe is a downgrading of the agricultural research sector. Cotton and dairy interests will likely ask Perdue for an update of possible assistance to those sectors. Trade policy queries will likely come on several individual topics.
Stocks of wheat at India’s ports at record high... Supply tightness after back-to-back years of drought prompted India to import nearly 5 MMT of wheat between June 2016 and April 2017, which was its highest level in a decade. But now that a bumper domestic crop is hitting the market, flour mills are uninterested in buying imported supplies. This has left India with record-high wheat inventories at its ports of around 1.8 MMT. But traders note that demand for imported wheat may pick up late this year or early in 2018 as it will take time to rebuild stocks to comfortable levels.
Brazil auctions financial instruments meant to improve prices for corn producers... Brazil’s food supply agency Conab will hold auctions of three financial instruments on corn (put options and the so-called PePro and PEP contracts) on May 25 in Mato Grosso. The instruments that will be auctioned are meant to ensure that growers in this top producing state receive at least the minimum value for corn guaranteed by the government in a year where a record-setting crop has weighed on prices. This is Conab’s third such auction this year.
Marginal gain in German wheat acres... German farmers have planted around 3.16 million hectares to winter wheat this season, which is a 0.9% gain from the year prior, reports the country’s national statistics office. Germany is the European Union’s No. 2 wheat producer and wheat exporter. On the other hand, its rapeseed sowing fell by 1% to 1.31 million hectares. The country is usually the bloc’s top rapeseed producer.
Choice boxed beef values continue higher... Cattle futures have faced pressure this week amid speculation the cash and product markets have hit or are near a top. While Select values slipped the past several days, Choice cuts continue to climb and are up $7.72 for the week. This has widened the spread between the cuts to $25.49. Cash cattle trade is at a standstill, but traders are banking on trade taking place below last week’s $138 action in most locations.
Uptick in pork movement... Pork movement was solid at 361.77 loads yesterday on a $1.61-gain in the pork cutout value. All cuts except hams strengthened, with ribs and bellies leading gains. Traders are hopeful this signals retailers are preparing for post-Memorial Day pork features. Cash bids were softer in the western Corn Belt but higher in the eastern Belt yesterday.
Overnight demand news... Jordan made no purchase in its international tender to buy 100,000 MT of milling wheat; it also issued a new tender to buy 100,000 MT wheat from optional origins. Tunisia issued an international tender to buy 92,000 MT of soft milling wheat from optional origins. Egypt tendered to buy an unspecified amount of wheat from global suppliers. Taiwan bought around 65,000 MT of corn likely to be sourced from Brazil. Japan received no offers in its simultaneous buy and sell auction to purchase 120,000 MT of feed-quality wheat and 200,000 MT of feed barley.
Today’s reports:
- 9:30 a.m., Weekly Ethanol Production -- EIA
- 2:00 p.m., Broiler Hatchery -- NASS
