Morning Comments/Roy's (RJ O'Brien)

Morning Grain Comments - April 26 2024

May options expire at the close today.  FND for May futures is next Tuesday.

CORN: Corn is consolidating after this week's rally and with wheat taking a pause.  Good planting progress was made across the Midwest in the days before the rain.  Monday's planting progress should stay ahead of the 5-year avg but unlikely to see a record jump...(Thomas Meierotto notes record 1 week jump in corn planting was 43-point jump in 1992 and 2013).  French corn planting on the other hand is just 26% complete vs the 5-year avg of 51% due to cold/wet weather.  US corn values holding steady for nearby with end users rolling corn bids to the July contracts and taking the 11 cent/spread.  CIF corn values competitive vs S American values through June.  Argentine values cheaper by 15-20 cents/bu for July forward.  Outside markets are steady to firmer.  Look consolidating trade with tonight's CFTC report showing funds exiting shorts in corn and wheat.  

WHEAT: US Wheat is slightly firmer in mixed trade overnight.  US wheat futures have seen their largest 1-week rally in almost 2 years on the crop concerns in Russia and KS.  Overnight western 1/3rd of KS missed most of the rainfall and next rain forecast is not until May 5-6th and then May 10th.  HRW crop ratings are expected to slip again in Monday's report.  French wheat G/E scores slipped again 1 point to 63% on cold/wet weather (year ago G/E was 94%).  The EU cuts its wheat production estimate to 120.2 mmt, down 0.6 mmt from their estimate a month ago and would be the lowest since 2020 (last time EU plantings dealt with wet planting weather).  Weather forecast for southern Russia trying to bring some light moisture in for May 5-6th time frame but confidence is low.  Look for the wheat market to consolidate its gains heading into the weekend with resistance toward $6.50 in KWN.  Breaks will be supported though.  

SOY-COMPLEX:  Soybeans are lower along with soymeal as Argentina is expected to make some harvest progress next week. Currently Arg soybean harvest at 22% complete is almost 23 points behind its 5-year avg.  BAGE looking to trim its estimate of the Argentine soybean crop to 51 mmt due to yield reports so far.  Wet weather is hampering the last 20% of Brazil soybean harvest in its southern regions.  US soybean basis at Midwest processors firming.  Cash crush margins continue to struggle with weak soy oil values with margins slipping under 70 cents/bu.  More processors starting to roll meal bids to the July. Look for weaker trade today.