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3 Big Things Today, May 12, 2021

Soybean Futures Jump Overnight; WASDE Expected to Show Lower U.S. Bean Stocks.

1. Soybean Futures Jump in Overnight Trading

Soybeans surged and corn was modestly higher in overnight trading ahead of today’s World Agricultural Supply and Demand Estimates (WASDE) report from the U.S. Department of Agriculture.

The USDA is expected by analysts to lower its outlook for domestic soybean inventories and Brazilian corn production.

Government officials have inspected 55.7 million metric tons of soybeans for overseas delivery since the marketing year started on Sept. 1.

That’s up from 34.3 million tons during the same time frame last year, the agency said.

Corn inspections for offshore delivery are now at 45.2 million metric tons, up from 25.2 million tons during the same period last year, government data show.

Persistently dry weather in parts of Brazil, meanwhile, likely will lead to a reduction in the USDA’s outlook for soybean production in the South American country, analysts said.

Dry weather is expected to continue in parts of Brazil, curbing the country’s second, or safrinha, corn crop.

More than half of the country’s Corn Belt will see continues stress as dry weather for at least the next 10 days curbs crop prospects, Commodity Weather Group said in a report yesterday.

Soybean futures for July delivery jumped 24¼¢ to $16.39 a bushel overnight on the Chicago Board of Trade. Soymeal added $4.40 to $451.40 a short ton, and soy oil gained 0.45¢ to 65.25¢ a pound.

Corn futures for July delivery gained 1¾¢ to $7.24 a bushel.

Wheat futures for July delivery fell 2¼¢ to $7.39½ a bushel, while Kansas City futures lost 2¢ to $7.08½ a bushel.

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2. All Eyes on U.S. Soybean Stockpiles, Brazilian Corn Production in Today’s WASDE

The USDA’s outlook on domestic soybean inventories and Brazilian corn production likely will decline in reports today.

Strong global demand for soybeans and adverse weather in the South American country will contribute to the cuts, analysts said. The May supply and demand and WASDE reports are due at noon in Washington.

The Ag Department likely will project U.S. soybean inventories at a mean of 110 million bushels, down from an April projection for 120 million bushels, according to consensus estimates from analysts.

Corn stockpiles are seen by analysts at 1.28 billion bushels vs. last month’s government outlook for 1.35 billion bushels.

Demand for agricultural products has been robust since the marketing year for beans and corn started on September 1.

Exporters have shipped 56.3 million metric tons of soybeans overseas since the beginning of September, up 66% from the same time frame last year.

Corn shipments have jumped 81% year-over-year to 43.5 million metric tons, U.S. government data show.

In South America, meanwhile, Brazilian corn production will be front and center as the USDA is expected to peg the country’s corn crop between 100 million and 106 million metric tons. That’s down from the previous month’s projection of 109 million metric tons.

Extremely dry weather that’s lasted for weeks has curbed production in the South American country.

Brazilian consultancy AgRural last week said it now expects the country’s second, or safrinha, corn crop at 69 million metric tons, down from a previous outlook for 75 million tons.


3. Freeze Warnings and Frost Advisories Issued in Northeastern Corn Belt

Extremely cold weather has led to freeze warnings and frost advisories in much of the north-central and eastern Midwest this morning.

In central Wisconsin, freeze warnings are in effect again as temperatures overnight were forecast to drop into the upper-20s, according to the National Weather Service.

In northern Michigan, temperatures were expected to drop as low as 30°F., the NWS said in a report early this morning.

Frost advisories are in effect from eastern Iowa into Pennsylvania and upstate New York, weather maps show.

In central Nebraska, meanwhile, thunderstorms are expected starting tomorrow and could bring some gusty winds and small hail, the NWS said.

“Daily chances for thunderstorms continue for portions of the outlook area through Tuesday,” the agency said. “Details remain uncertain, but at least some severe weather is possible.”

Farther south in much of Oklahoma, storms likely will return heading into the week. Some strong storms are likely at this time, the NWS said.

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