AG MARKET UPDATE: MAY 15-21
Corn had a decent week following the collapse to end last week’s trading. The biggest news was on the export front where China continued their large purchases of corn adding on to the impressive pace of Chinese buying for new crop. The US weather looks good for planting as some areas continue to try to get their crop in the ground ahead of summer temperatures setting in across the country. Other corn demand news remains positive as the EPA is expected to leave the ethanol mandate unchanged and Brazil’s second corn crop continues to shrink. Brazilian private analysis firm Agro-consult cut their estimate of Brazil’s corn crop to 91.1 million metric tons which is 10.9 mmt (430 million bushels) under last week’s USDA estimate. With a shrinking South American crop the demand for US corn this year should be high. That said, anything under 175 bpa yield could really tighten the balance sheets. US corn was seen as being 80% planted at the start of the week with more progress made this week.
Soybeans continued its dip down this week as the demand has shifted to Brazil where prices are currently lower than in the US in the near term. Funds have taken profits after holding historic long positions. It will be important for them to get involved if we want another run up as demand and US weather will be the main fundamental drivers for the near future. Soybean planting was seen as being 61% complete to start the week as more progress was made this week. Good weather vs a slowing in demand has given the bears momentum this week but there is still a long way to go and we know China is likely needing to make additional bean purchases along with corn.
The Dow has made small gains on the week as the markets remain volatile with up and down days. Covid around the world delaying reopening’s are causing some issues in places, like Japan, which has the worlds 3rd largest economy.
Check out our recent post about the lumber market and what all has been going on.
Check out our recent podcast with Dr. Greg Willoughby: We’re talking with Greg in the new episode about being a “plant doctor”, weather patterns, GMO & organic produce, crop history, technical advances, level 201 education on agronomy, the agronomy equation, Helena Agri, soil biology, American v European agriculture, Greg’s early background in livestock, and the advancement of native plants to modern produce.
US Drought Monitor
The map below shows this week’s drought conditions across the US. Some areas received rain over the weekend improving some areas while others, like the Dakotas and Michigan, remain dry.