Corn futures ended the session mixed. Better than expected rainfall for some areas this past weekend initially weighed on prices but concerns surrounding reports of crop damage due to high winds and hail (in some areas) offered support. While scattered rains were beneficial for the areas that received it this past weekend, more is needed to end drought conditions in certain regions. Last week’s drought report showed 41% of the corn area in the Midwest was in some form of drought. The GFS outlook was drier midday than the overnight run for the SW Midwest and the E Plains, but slightly wetter for ND. Widespread showers are still expected late this week and weekend (primarily for the central and eastern Midwest). This afternoon’s weekly crop progress report is expected to show another 2-5% decline in corn ratings, as last week’s rains were extremely variable, and temperatures were above average. Extended weather models will be watched closely moving forward, as much of the crop starts to transition into pollination in July. Dryness is expected this week for central Brazil (continuing to stress the crop) while southern Brazil should see another round of moderate rainfall. Dry conditions should favor harvest progress in Argentina. Argentina’s corn harvest is estimated to be just over 42% complete. Weekly U.S. corn export inspections totaled 58.3 mln. bu. in this morning’s report. This was a modest drop from last week’s 63.4 mln. but exceeded the “needed” weekly total to meet USDA’s annual forecast. 795,000 tonnes were inspected for China, putting remaining unshipped old crop purchases around 6.6 MMT. Cumulative export inspections stand at 2.186 bln. bu. with 10 weeks remaining in the 20/21 marketing year.
Soybeans
Soybean futures ended the day higher as July beans and soyoil paced the recovery from losses noted early in the day. Confirmation from USDA this morning that China purchased new crop U.S. beans late last week was seen as supportive. FAS announced sales of 336,000 tonnes of beans for delivery to China and 120,000 tonnes for delivery to unknown destinations, both for the 21/22 marketing year. The anticipation of a drop in condition ratings this afternoon was also seen as friendly. The latest drought monitor last week showed 36% of the U.S. bean area was under drought. Last week’s lack of rain along with hot temperatures has traders expecting to see a decline of 2-5% in the bean crop rating. Tight bean balance sheets continue to reiterate that the U.S. cannot afford anything but a trendline yield, as supplies would not be able to keep up with demand. Weekly U.S. soybean export inspections fell within trade estimates this morning at 6.4 mln. bu., just shy of the amount “needed” per week to reach USDA's 2.280 bln. bu. export projection. Shipping activity for China was nearly non-existent at just 4,000 tonnes. Export sales data shows China has roughly 685,000 tonnes in unshipped old crop purchases still on the books. In the month of May, China imported just 244,000 tonnes of U.S. beans, marking the lowest total since August.
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