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The rally in corn ran into a firestorm this week because of the forecast for improving weather. Even though the rating fell 4-points last week to 68 percent of the crop in good-to-excellent condition, it took a backseat to the improved outlook. According to Ag Watch’s yield model, this equates to a national yield of 170.4 bpa compared to 172.0 bpa a year ago. Right now, the question is whether the improving forecast will be enough to boost the areas affected by dry conditions. Meanwhile, in other developments, exports were sound again last week at 60.7 MB with China taking 36.7 percent of shipments. While they continue to have a strong appetite, the overall pace of shipments has fallen 12.4 percent in the last 4 weeks which implies that our traditional customers are backing away.
Soybeans were slammed this week because of the improving weather outlook. The 5 percent decline in the crop rating last week to 62 percent in good-to-excellent condition failed to offer any support. According to Ag Watch’s yield model, this translates to a national yield of 47.7 bpa versus last year’s yield of 50.2 bpa. Another factor weighing on values is shabby exports. Last week, inspections were a marketing year low of 4.7 MB with China barely visible. Since November, the pace of shipments has declined 92 percent, and rarely falls more than 85 percent. If stocks were not tight, prices would be much lower.
There is not a lot of fresh news in wheat. Winter wheat harvest has begun but is lagging at 4 percent done compared to 15 percent for the average. The rating for the spring crop fell one-point to 37 percent in good-to-excellent condition. This compares to 81 percent a year ago and 71 percent for the 10-year average. Export inspections for the week were 17.6 MB. Meanwhile, Egypt canceled a tender for unknown reasons. Wheat needs a story to tell and may not find one until harvest is complete.
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