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Corn Outlook:
I believe President Trump can measure up to any player in the NBA when it comes to trash talking. He certainly minced no words earlier this week when he threatened to blow Iran back into the Stone Age, and living in caves if they do not reopen the Strait of Hormuz. However, his rhetoric softened later, and a 2-week ceasefire has been agreed upon, although it is on fragile footing. Hopefully, this is a step in the grains getting back to trading the fundamentals rather than geopolitics. In other developments, the USDA left ending stocks of corn unchanged at 2.127 BB but raised global stocks 2.0 million tons to 294.8 million. Brazil and Argentina’s production was also unchanged. No changes were made to usage. The report was neutral to negative with the focus being on the Middle East. Meanwhile, exports shined last week with inspections of 78.2 MB, the second highest of the season.
Bean Outlook
While developments in the Middle East is the top news story, traders remain optimistic of the summit meeting scheduled between President Trump and Xi of China in mid-May. They are hopeful of a deal being struck in which China buys additional U.S. soybeans. Although they may agree to some purchases, it might not be more than a token amount because of the record harvest in Brazil, and them being a cheaper source. In other developments, the USDA left ending stocks unchanged at 350 MB but lowered global stockpiles 500,000 tons to 124.8 million. Crushings were increased by 35 MB which was offset by a 35 MB decline in exports. Brazil and Argentina’s production was unchanged. The report was mostly neutral. Looking at exports, inspections last week were 28.6 MB with China taking shipments of 18.3 MB.
Wheat Outlook:
Wheat tumbled this week as Trump and Iran agreed to a 2-week ceasefire, increasing the prospect of reopening the Strait of Hormuz. Meanwhile, the first crop rating for the year shows 35 percent of the winter wheat crop in good-to-excellent condition, down from 48 percent a year ago. However, this is on par with the 10-year average. Conditions will likely improve as increased moisture is forecast in the Plains over the next couple of weeks. Looking at exports, they offered no thrills last week with inspections of 12.2 MB. However, that is no surprise as U.S. wheat is the most expensive on the planet. In other developments, the USDA increased ending stocks 7 MB to 938 MB and raised global stockpiles 6.1 million tons to 283.1 million. The report is considered bearish.
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