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Corn bolted out of the starting gate early this week as the bears hit the pause button. The recovery might be limited as the crop progress report showed that corn planting is 81 percent complete, which is well above the average of 75 percent and 69 percent of the crop planted a year ago. With emergence 7 percent higher than the average, it brings into focus that unless weather becomes a major issue, USDA’s yield estimate of 181.5 bpa and ending stocks of 2.2 BB could be a reality. Meanwhile, on the bright side, export inspections last week were the second highest of the season at 52.0 MB. They must average 46.4 MB each week to reach USDA’s target of 1.775 BB, and that remains a big question. If they do not, a weather incident will be needed at some point to incite bullish interest.
Soybean futures also began the week on a strong note, but soon waned as the crop progress report showed planting well ahead of schedule at 66 percent complete compared to 47 percent a year ago and 52 percent for the average. In addition, emergence is 12 percent above the average and suggests that unless Mother Nature deviates from its current pattern, USDA’s yield estimate of 52.0 bpa and ending stocks of 335 MB could become an actuality. Also, we are staring at a record crop in Brazil that offers competition. Meanwhile, exports continue to struggle with inspections last week, the second lowest of the season at 5.6 MB. Since last November, the overall pace of shipments has fallen 88.1 percent while those to China have declined 96.1 percent. The bottom line in soybeans is that positive input is currently lacking to attract sustained bullish interest.
Extension of the grain agreement between Ukraine and Russia poses a headwind for wheat. Meanwhile, moisture in the southern Plains boosted the winter wheat rating 2 points last week to 31 percent of the crop in good-to-excellent condition. This is higher than last year’s rating of 28 percent but below the 10-year average of 45 percent. Weather in the upper Midwest has been more cooperative lately and allowed spring wheat planting to progress to 64 percent complete compared to 48 percent a year ago and 73 percent for the average. Export inspections were better than expected at 14.9 MB and must average 7.2 MB the next couple of weeks to reach USDA’s target of 725 MB. However, keep in mind that this is not a great achievement as exports are at an historic low.
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