Weather, USDA Report in focus
This week's weather is seen as dry, according to WXrisk.com, the agriculture weather site. That is sparking buying in the commodities market.
Dry conditions are seen into early Wednesday then possibilities of a Midwest Corn Belt rain late that day into Thursday. Right now, rain totals look light with most areas with .10 to .75 inches. Northern Illinois could see up to 1-inch. If realized, this would create higher prices to start the week, as it's similar to last week when light rains led to thoughts that Monday's crop condition report will show further declines.
But, expect a profit-taking break ahead of Friday's big USDA Planted Acreage Report. Traders won't risk weather profits on the acreage report. Rule of thumb, a higher opening on Sunday means a higher close. A lower opening, a lower close. Those trading the Sunday night opening range have professional weather services. If they are buying it's because Sunday's weather outlook for the week looks dry, or selling means more rain has entered the forecast.
Last week's Weekly Export Sales Report showed old crop year corn exports at 171,000 metric tons and new crop year 210,000 mt. China was in for 19,000 mt of the total. The past three weeks have confirmed that our government has importers backing away from old crop year export deliveries and largely going new crop year. But, the new crop year sales are shrinking somewhat, as importers may be waiting for the key crop yield time to pass, in July, before they enter for needs. The foreign buyers may be hoping that timely rains during pollination for corn brings lower cash bids. The lower cash prices, last week, suggests that US exporters are hearing from importers that they will be patient. So, we might expect a slower export pace until late July when corn yields will generally be determined, as pollination winds down. Bean exports were 163,000 mt. old crop year delivery and 444,000 mt for new crop year delivery, after September 1. China was in for 101,000 mt old crop year, and 430,000 mt new crop year. The last two weeks China has been going away from old crop where they were very active and piling on new crop year delivery, a pattern we're seeing in corn. In part, due to new crop prices being cheaper.