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Corn Outlook:
Unless an unforeseen geopolitical event arises, news in the grains will be mostly sparse until the planting intentions report on March 28th. However, a greater handle on planted acres will not be known until the June report. In the meantime, the growing season is approaching, and the funds are sporting a short position in corn of 1.525 BB and could reduce their position in the weeks ahead. Looking at exports, inspections last week were 44.1 MB and below the average of 49.6 MB that must be shipped weekly to reach USDA’s target of 2.1 BB. The pace of shipments has been rising since the third week of January, but not enough to meet their projection. The bottom line in corn is that although expectations are for a reduction in acres, ending stocks of 2.172 are sufficient to meet demand. That said, a weather event will probably be needed to whet bullish interest.
Bean Outlook
Soybeans have been recovering the past couple of weeks and might see more on the upside as the funds are holding a record short position of 970 MB and could cover ahead of the planting intentions report later this month. However, longer-term, it will be an uphill struggle if the expected increase in planted acres materializes. Currently, ending stocks are forecast at 315 MB, but that will likely grow with an acreage increase. What is disturbing is that USDA’s latest projection shows China’s imports rising 3.0 million tons while Brazil’s exports also rose 3.0 million. Meanwhile, U.S. exports were unchanged. Since 2020, our exports have been on the downswing, and that will likely continue. Last week, export inspections fell to 25.0 MB and are down 54 percent from their peak in November. China took 12.4 MB which is down 64 percent from their peak. The bottom line in soybeans is that unless weather becomes a factor, or fewer acres are planted than expected, we may see stocks grow to over 400 MB.
Wheat Outlook:
USDA lowered their export projection in wheat 15 MB last week to 710 MB, which was not a surprise, as shipments this season have been sluggish to say the least. Last week, inspections were 14.8 MB and must average 18.2 MB each week to meet their target. Adding insult to injury, China has recently canceled three sales. Right now, we are on track for shipments of 670 MB. The bottom line is that exports have been on the downswing since 2010.
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