Weekly Market Recap


Flooding on the Mississippi river is preventing traffic up north. It will most likely be late May before barges are running into the Minneapolis/St Paul area.  There is a lot of fertilizer just parked in barges in St Louis as there is nothing that can be done until the high water level recede allowing the lock and dam system to open. The USDA said it will not survey producers for the amount of grain lost due to flooding from the bomb cyclone. Any losses from on farm storage will be captured in the June stocks report. The next round of trade talks between the US and China is scheduled to take place next week on April 30th in China. There is speculation that Chinese President Xi could visit the US in June to sign a trade deal. This is unconfirmed at this point but would be very much welcomed by the grain trade to get back to trading fundamentals.  


The US ag attaché in China says Chinese corn production will be 255 million tons but consumption should jump to 282 million tons.  They are expected to up imports to 5 million tons, but the attaché doesn’t think the US will supply any of it. According to the USDA attaché in China, they hold about 65% of the world’s corn stocks.  Brazil’s safrinha corn crop is estimated to be 68.43 million tons which would be a record.

Corn planting is only 6% complete compared to the 5 year average of 12%. Ethanol data was a positive this week as we saw a big jump up in production. Ethanol margins also rose by a couple of cents as well. The EPA has rejected requests to extend the comment period on year round E15 sales.  


A French consultancy is predicting that the Russian wheat crop will grow by almost 7 million tons over last year’s crop. Australia is one of the only areas of concern in world wheat. Winter wheat planted can start now but soils are extremely dry and concerns about production totals are starting to show up. Above average rains are projected for western Australia and these will be key to future production. According to the USDA attaché in China, they hold just over 50% of the world’s wheat stocks. The International Grains Council has increased its global wheat forecast by 3 million tons to 762 million. Most of the increase is due to larger Russian production.  

The latest crop conditions showed that winter wheat good/excellent ratings improved by 2% to 62%. One year ago, the rating was a lowly 31%. Spring wheat planting is 5% complete compared to the 5 year average of 22%. Export inspections on wheat were easily the highest of the year at 811,000 tons. The wheat quality council tour across Kansas kicks off next Monday.


The Rosario Grain Exchange has increased Argentine soybean production to 56 million tons. Last year’s production was a disaster at only 37.8 million.  The USDA is penciling in the Argy crop at 55 million. The spread of ASF through China could reduce their soybean imports down to 85 million tons.  The USDA is currently estimating 88 million tons of imports for China.  Analysts are expecting StatsCan data to show canola seeding at 21.8 million acres which is 1 million tons lower than last year. Canada is feeling the pinch from a trade dispute with China also. China has cancelled the export registrations of a couple of Canada’s largest canola exporters. Due to that, actual canola plantings are down more than expected at 21.3 million acres which is the lowest total since 2016. Palm oil future were down big losing 39 ringgits on Friday to 2119. This is the worst weekly performance in about 5 months.   

China imported 1.5 million tons of soybeans from the US in March. That is up nicely from February but only about half of what they imported from the US last March. The first soybean planting reading is 1% complete compared to the 5 year average of 2%. Soybean inspections were the lowest of the year at just 382,000 tons. New daily price limits go into effect for soybeans on May 1st. The old limit was 60 cents, while the new daily limit will rise to 65 cents.  Limits are changed twice a year on May 1st and November 1st.


China has reported new cases of African Swine Fever (ASF) in Hainan province.  These new cases mean the disease has now spread to every province in China. China is saying that pork imports could rise 40% due to ASF.  The hog market saw a net cancellation to China in the weekly export sales data and proceeded to lock limit down.  A class action lawsuit was filed by ranchers and cattlemen against the big 4 meatpackers saying they conspired to keep beef prices low.


Prices are lower to close the week as President Trump persuades OPEC to lower oil prices. Profit taking is also pressuring prices after hitting recent highs. OPEC member, Nigeria is expecting to nearly double production and dramatically increase refining capacity over the next 6 years. AAA is reporting the average for a gallon of gasoline at the pump at $2.877. Prices a month ago averaged $2.628 and $2.791 last year.