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3 Big Things Today, June 3

Corn, Soybeans Lower Overnight, Export Sales of Grains Higher Week to Week.

1. Corn, Soybeans Lower Overnight Amid Trade Disputes

Corn and soybeans were lower in overnight trading as trade tensions continue to escalate.

The U.S. is now involved in trade disputes with China, as it has been for almost a year, and Mexico, after President Donald Trump said he would impose tariffs on Mexican imports unless the country slowed illegal immigration across the border.

Analysts from J.P. Morgan and Morgan Stanley said they don’t expect a deal between the U.S. and China to be brokered at the Group of 20 meeting later this month. Both Trump and his counterpart Xi Jinping will be on hand, and the last time the leaders got together they reached a tentative trade deal.

It’s still unclear, however, whether they will meet at the event in Japan.

Last week, Trump said he would impose a graduating tariff on imports of Mexican goods starting at 5% until the country stops illegal immigration into the U.S.

The White House said the tariffs will start on June 10 and would increase to 10% if Mexico doesn’t comply. The rate will go to 15% on August 1, 20% on September 1, and 25% on October 1.

Mexico is the biggest buyer of U.S. corn, and China was, at one time, the biggest importer of U.S. soybeans.

Prices, however, are being underpinned by wet weather that’s kept producers from planting their field for the past several weeks. More storms are forecast from Texas to Kansas into Arkansas, the National Weather Service said.

Corn futures for May delivery fell 3¼¢ to $4.23¾ a bushel overnight on the Chicago Board of Trade.

Soybeans for May delivery fell 1¾¢ to $8.76¾ a bushel. Soy meal gained $1.80 to $323.10 a short ton, and soy oil declined 0.24¢ to 27.35¢ a pound.

Wheat for May delivery rose 2½¢ to $5.05½ a bushel in Chicago, while Kansas City wheat added 6¼¢ to $4.79¼ a bushel.

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2. Grain Sales Rise Week to Week, Soybean Sales Slightly Lower

Sales of corn and wheat to overseas buyers were higher week to week, while soybean sales declined, according to the USDA.

Corn sales in the seven days through May 23 jumped to 906,800 metric tons last week, rising 94% from the prior-week average, the USDA said in a report released Friday.

Japan was the big buyer at 713,200 metric tons, Mexico took 184,700 tons, Colombia bought 147,800 tons, and Guatemala purchased 20,600 tons, the agency said. An unknown customer canceled a shipment for 203,200 tons, and South Korea nixed a shipment for 63,700 tons.

Sales for the 2019-2020 marketing year totaled 76,500 metric tons after Mexico bought 30,000 tons of the grain.

Wheat sales for the marketing year that ended on May 31 also increased, jumping to 153,000 metric tons, the USDA said.

Indonesia led by purchasing 70,000 metric tons, Yemen was in for 44,000 tons, Canada bought 29,900 tons, Japan took 29,000 tons, and the Dominican Republic purchased 27,4000 tons. Unknown buyers canceled cargoes of 140,000 metric tons.

In the 2019-2020 marketing year that started on June 1, sales came in at 411,800 metric tons, as unknown customers bought 83,400 tons, Japan was in for 82,600 tons, the Philippines bought 55,000 tons, Nigeria took 50,000 tons, and Indonesia purchased 43,000 tons.

Soybean sales in the current marketing year that ends on August 31 were reported at 455,800 metric tons, down 15% week over week but up 92% from the four-week average, the USDA said.

China was again the big buyer for the week, but only took 135,700 metric tons. Spain was in for 57,000 tons, the Netherlands purchased 56,800 tons, Canada bought 47,700 tons, and Japan took 33,800 metric tons.

For the 2019-2020 year, sales totaled 22,000 tons.

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3. Thunderstorms Expected in Parts of Texas, Oklahoma, Kansas Monday

More storms are expected in parts of the Southern Plains into the Midwest today that may bring damaging hail and winds, according to the National Weather Service.

Thunderstorms are expected to move from western Oklahoma east today, bringing severe weather to much of the state.

“The main threats from the storms will be damaging wind gusts, very large hail, and potential for flash flooding,” the NWS said in a report early Monday morning. “Additional rainfall from northern Texas to southeast Kansas, and Arkansas through this week will hasten ongoing major to record flooding.”

The storms are unlikely to let up for most of this week, as a series of weather disturbances keep the rain coming, the agency said.

Farther north, storms are expected in parts of eastern Iowa and northern Illinois tonight, though the chances of severe weather are slight to marginal, the NWS said.

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