May 9: Grain Traders Prepare for May 2018 WASDE Report

This afternoon, we sat down and did a full dive into expectations for the May 2018 WASDE report. [You can read it, right here.]

But before you do (and we’ll provide the link again), let’s talk about what happened in grain trading Wednesday.

Traders set their positions ahead of tomorrow’s WASDE report. With the USDA set to project its first numbers on production and carryout for the 2018/19 calendar, tomorrow could be quite an eventful day at the Chicago Board of Trade.

Let’s recap trading ahead of tomorrow’s WASDE report.

Chicago Wheat Dips Ahead of May WASDE Report 

In Chicago, Soft Red Winter (SRW) wheat prices were in the red. The July SRW contract lost 4 cents and closed at $5.105 per bushel. The September contract shed 4.25 cents and ended the day a tick above $5.27 per bushel.

Down in Kansas City, July Hard Red Winter (HRW) wheat prices fell 6.75 cents to end the day at $5.315. The September contract shed 6.75 cents and closed the day just under $5.50 per bushel.

Up in Minneapolis, Spring Wheat prices dipped 2.75 cents to close just above $6.11. The September MGEX contract shed 3.25 cents to close just under $6.18.

Aside from tomorrow’s WASDE report, we’re looking at tomorrow’s weekly crop sales report. Old crop sales are expected to come in between zero and 350,000 MT. New crop estimates are pegged at 200,000 MT to 350,000 MT.

Meanwhile, on Friday… we’ve got an update from Statistics Canada. The Canadian agency will provide its quarterly update on stocks. Analysts project that wheat stocks ending March 31 will be lower than the same period last year.

Soybean Prices Dip Yet Again 

Given that the USDA report was written over the course of the month – and since there isn’t too much data analysis – we can’t expect tomorrow’s report to touch on recent events in Argentina. The Argentine Peso has plunged over the last two weeks, and it’s likely going to affect the nation’s exports and broader supply chain.

This will be a subject that we’ll explore more this weekend in GrainCents. If you want to know just how much the U.S. Dollar/Argentine Peso exchange will matter in the months ahead – be sure to sign up for a free three-week trial.

You can do so right here.

With that in mind, U.S. soybean prices were off in Chicago Wednesday. The July contract shed 4.5 cents to close the day just under $10.16 per bushel. The August contract shed 4 cents and ended the day above $10.19.

Since we’re not going to dive into the WASDE report in today’s GMT (you can read about projections here), let’s turn our attention to the other major event happening tomorrow.

The USDA will release its weekly update on soybean sales and exports. Trade analysts expect that old crop soybean sales will come in between 300,000 MT to 600,000 MT for the week ending May 3. New crop sales are forecasted between 100,000 MT and 300,000 MT.

Corn Prices Dip Before WASDE

Finally, corn prices dipped slightly on Wednesday. The July corn contract shed 0.5 cents to close the day just under $4.03 per bushel. The September contract shed 0.25 cents to end the day at $4.11. It was relatively quiet comparatively in Chicago in the corn complex.

Aside from preparing for tomorrow’s WASDE report, markets digested today’s update in the ethanol business.

The Energy Information Administration reported that daily production dipped by 8,000 barrels during the week of May 4. Daily production is now sitting at 1.04 million barrels. Stocks are now at 21.964 million barrels after a 178,000-barrel decline for inventories last week.

Tomorrow, we’ll also be looking at another important export report. Analysts project estimates ranging from 50,000 MT to 300,000 MT for new crop sales. Old crop sales are pegged between 700,000 to 1 MMT.

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About the Author
Garrett Baldwin

Garrett Baldwin is a content strategist and editor at FarmLead. He covers the global grain markets and public policy issues related to the agricultural industry. He is a graduate of the Medill School of Journalism at Northwestern University. He also holds a Master’s Degree in Economic Policy from The Johns Hopkins University, an MS in Agricultural Economics from Purdue University, and an MBA in Finance from Indiana University.

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