May 10, 2022

A bit of a turnaround Tuesday with corn gaining 3-7 cents and soybeans picking up 5-10 cents on back-and-forth type trade. Buyers and sellers both struggled to establish momentum and it feels like we will probably see a small rally heading into Thursday's WASDE report after yesterday's planting progress update from the USDA showed corn, soybean, and spring wheat seedings all behind trade estimates and still well behind 5-year averages: corn 22% (25% estimated), soybeans 12% (16% estimated), and spring wheat 27% (28% estimated). The USDA has been quiet at 8 a.m. with no export sale announcements so far this week. Something that really needs to be paid attention to is the condition of Brazil's second corn crop. 88% of the 2nd crop corn in Parana, Brazil is currently seen as in good condition, compared to 25% the same week last year. Last year we were told that Brazil would run out of corn to ship early based on their crop conditions and it never happened. Early harvest of this crop has already started. The markets have not had much to say about Brazil lately which is usually a sign that the crop is very good. Sales target for new crop corn is reset at $7 and $14.50 for new crop soybeans. A move on the cash side to $8 corn and $16 beans should also trigger a sale, if any available.

The Dec 22-Mar 23 corn spread has been trading near a 4 cent carry. Not a bad place to roll a hedge if you know you’re going to be storing corn.

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