Grain Comments: 04-26-2023

Good morning:

The grains have found some buyers since yesterday morning’s lows, but bullish enthusiasm seems low with rain falling in the southern Plains and corn belt forecasts generally dry (save for rain chances this weekend). Russia continues to bark about the state of the Black Sea grain export deal and blame the West for lack of progress, ahead of the May 18 deadline.

Rains continue in the southern Plains this morning after good amounts in Oklahoma and the Panhandles over the past 24 hours, lesser so in Kansas with precipitation there holding south and west so far; chances remain today before shifting out to the southern/southeastern U.S. through tomorrow. Rain will occur in the north across the last half of this work week as well, mostly in Minnesota and surroundings. Extended maps remain cool and dry, though there’s a chance for warmer and wetter conditions moving in from the far west by the end of that latter 11–15-day period (into the second week of May). • Rains again fell in central-southern Brazil over the past 24 hours, shifting into northeastern safrinha corn crop areas through the weekend.

Even though we have several months left in the old crop marketing year, trade is starting to turn its attention to the new crop year. The most interest is falling on potential ending stocks which are expected to increase on both corn and soybeans. Corn carryout for the 2022/23 marketing year is currently projected at 1.34 billion bu (bbu). Some models show this dropping to 1.2 bbu given our rebound in export interest, although the cancellations we are starting to see on US bookings are impacting these thoughts. A sizable increase in new crop ending stocks is forecast with some scenarios topping the 2 bbu mark. This is not hard to justify given current market economics. Soybean ending stocks are currently estimated at 210 million bu (mbu), but this number could increase as demand for US offers has dropped considerably in recent weeks. Reports of increased US exports will also give us a larger old crop cushion. Private balance sheets show the actual US carryout closer to 250 mbu and new crops may reach 350 mbu. Even if not as high as models indicate, the possibility of them increasing is weighing on new crop values, especially on corn.

Have a great day!