Soybeans close 36¢ lower, corn ends mostly lower | Wednesday, May 19, 2021

On Wednesday, the CME Group’s farm markets tumble, even as China buys another huge amount of U.S. corn.

At the close, the July corn futures finished unchanged at $6.58¾. New-crop September futures ended 4¢ lower at $5.67. December corn futures closed 4¼¢ lower at $5.39. 
 
July soybean futures settled 36¢ lower at $15.38¼. August soybean futures finished 35¾¢ lower at $14.85½. New-crop November soybean futures ended 30¼¢ lower at $13.69.

July wheat futures settled 18¾¢ lower at $6.79½. 

July soymeal futures finished $7.60 per short ton lower at $403.20.

July soy oil futures closed 2.20¢ lower at 66.47¢ per pound.

In the outside markets, the NYMEX crude oil market is -2.17 lower (-3.31%) at $63.32. The U.S. dollar is higher, and the Dow Jones Industrials are 317 points lower (-0.93%) at 33,743 points.

On Wednesday, private exporters reported to the USDA the follow activity:

• Export sales of 1,360,000 metric tons (54.0 million bushels) of corn for delivery to China during the 2021/2022 marketing year.
• Export sales of 142,500 metric tons of soybeans for delivery to Mexico during the 2021/2022 marketing year.

The marketing year for corn and soybeans began Sept. 1.

In the last four business days, China has purchased 229 million bushels of U.S. corn. That is more than many states’ annual production.

Al Kluis, Kluis Advisors, says that investors are watching China’s corn purchases, and expected rainfall events.   

“Cumulative rain forecasts for North Dakota and Canada over next week are very impressive on paper. It is almost hard to believe the rainfall expected in the large area that has been struggling to catch a rain for months. In anticipation of these rains, Spring wheat prices have fallen over $1 since the May 7 high,” Kluis stated in a note to customers. 

“Some traders are thinking we could see China cancel old-crop soybean purchases and roll them to new crop. However, there are valid reasons to believe that China will not cancel old-crop purchases. The world supply of soybeans is still much tighter than we have seen in many years. Many indicators still point to China working toward restocking their strategic grain reserves,” Kluis stated in a note to customers. 

Kluis added, “China has taken advantage of the recent decline in new-crop corn prices. They have secured nearly one-third of their expected corn imports for the next marketing year in the past two weeks. This is an unprecedented pace of purchases by China.”