Ag Market View for Apr 26.23


The soybean complex was mixed as nearby spreads continue to pull back.  The May/July spread slipped $.06 ½ to $.21, down from $.39 earlier in the week.  Deferred contracts were within $.01 of unchanged.  Soybean meal is down $4 – $9, while soybean oil was 30 – 40 higher.  Next support for May-23 is the Mch-23 low at $14.05.  US soybeans remain at a significant premium to Brazil posing a threat for additional imports.  Spot meal has slipped to its lowest level in nearly 5 months.  Nearby soybean and meal contracts have been lower for 6 consecutive sessions.  Spot board crush margins slipped another $.06 to $.74 bu. testing the lows from last summer.  Stats Canada reports canola acres are expected to increase .2 mil. from YA to 21.6 mil., slightly below expectations.  Soybean acres are forecast at 5.5 mil. also up .2 mil. from YA, slightly above expectations.  EU soybean imports have reached 10.06 mmt as of April 23rd, down 12.5% from YA.  Export sales tomorrow are expected to range from 5 – 25 mil. bu., for soybeans, 100 – 400k tons soybean meal, and 0 – 15k tons soybean oil.


Prices were down another $.04 – $.05 today.  I believe weak demand is what continues to fuel the bearish sentiment.  There were no export announcements today.  Spot May-23 has closed lower for 6 consecutive sessions, barely holding above the April low of $6.40 ¼, closing at $6.41 ½.  Ethanol production fell last week to 967 tbd, down from 1,024 tbd the previous week.  Production was below the pace needed to reach the USDA forecast for the 9th consecutive week.  In the MY to date corn usage has reached 3.292 bil. bu., or 14.1 mbd, an annualized pace of 5.156 bil., vs. the USDA forecast of 5.250 bil.  The lower production and surging demand drew ethanol stocks down to 24.3 mil. barrels, well below expectations and the lowest in 3 months.  Implied gasoline demand last week surged 11.6% from the previous week and up 8.8% from YA.  It was also the highest in 16 months.  Ethanol production margins should surge given the lower supplies, strong demand, and lower cost for corn.  Canadian corn plantings are expected to reach 3.725 mil. acres, a touch above YA and in line with expectations.  EU corn imports thru April 23rd have reached 22.65 mmt for the 2022/23 MY, up 72% from YA.  US corn plantings this week will likely be below the historical average, after being slightly above average thru April 23rd.  Extended forecasts beyond the first week in May continue to suggest a warmer/dryer pattern developing, which if verified would accelerate plantings and early crop development.  Export sales tomorrow expected in a range of 10 – 40 mil. bu. 

Soybean fields


Prices were sharply lower in all 3 classes with MGEX down $.20 – $.30, KC down $.18 – $.25, while Chicago was $.08 – $.12 lower.  The best rains in months continue to fall across drought areas of the southern plains.  Time will tell if it was too little too late to salvage much of a HRW crop.  Either way we should see some improvement in crop conditions on Monday.  Extended forecasts for warm/drier outlook in the Northern plains really weighed on MGEX today as spot May-23 traded into new contract lows.  Stats Canada forecast all wheat acres at 26.97 mil., roughly 700k above expectations and up 1.5 mil. from YA.  Tunisia reported paid $304.80/mt CF for 75k of soft wheat.  It was also reported that a South Korean flour miller bought 77k mt of US milling wheat for summer shipment.  EU soft wheat exports for 2022/23 MY have reached 25 mt, up 10% from YA.  Export sales tomorrow expected at 5 – 20 mil. bu.

See more market commentary here.

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