May 14: Soybean Prices Rebound in Chicago

Soybean prices popped by double digits in Chicago as volatility continues to factor into the grain markets. Corn saw little change, while wheat prices dipped ahead of Monday’s crop progress report.

Markets are reacting positively to developments on the global trade front. Over the weekend, President Donald Trump offered a key concession to China in the technology sector. That news propelled soybean prices higher as traders are showing optimism that tariffs may be avoided in the markets in the future.

Let’s take a look at other factors impacting soybean prices and other grain prices in Chicago.

Soybean Prices Rebound

The July soybean contract added 14.5 cents to close the day a tick under $10.18. The August contract added 13.75 cents and closed at $10.21 per bushel.

We saw stronger trade numbers for the week ending May 10. The USDA said that the number of soybean inspections for the week came in at 688,185 MT (25.287 mbu). This figure was about a 28.5% jump from the previous week and 141.5% higher than the same period last year.

Farmers are really making progress on the planting front.

The USDA said this afternoon that 35% of the soybean crop has been planted. That figure is 9 points ahead of the five-year average and 6 points ahead of the pace from last year. The chart below provides a breakdown of planting progress in the top 10 producer states.

Analysts had expected the report to show that 30% of the crop had been planted, so this was a bit of a surprise.

As noted, farmers in Illinois led the way last week with a big uptick in planting. However, it’s very apparent that weather delays have impacted planting in South Dakota and North Dakota.

Up in Winnipeg, canola contracts were mixed. The July contract dipped CAD $0.10 to hit CAD $532.20. The January 2019 contract added CAD $1.30 to close the day at $524.10.

Corn Prices Tick Lower

The July corn contract was unchanged, finishing the day at $3.965 per bushel. The September contract shed 0.25 cents and closed the day just under $4.05.

Today, the USDA reported that corn inspections for the week ending May 10 came in at 1.55 MMT (61.2 million bushels). This figure was about 19% off from the previous week.

Japan was the top market for the week. Mexico came in a close second place.

This afternoon, the USDA provided its latest update on planting progress. Ahead of the NASS report, trade expectations for progress fell in a range of 55% to 60%.

How did the planting turn out?

The USDA says that 62% of the corn crop has been put into the ground. Farmers are still a point behind the five-year average.

However, it was another big week for American farmers given that the previous report showed progress at 39%.

Farmers made up a lot of ground in Minnesota, Indiana, and Illinois.

Progress is still well behind in South Dakota and North Dakota.

Wheat Prices Retreat

With May contracts expiring, markets were looking at updates on U.S. export data. This morning, the USDA pegged wheat inspections for the week ending May 10 at 404,180 MT (14.85 million bushels). This figure was about 22% higher than the inspections level from the previous week.

In Chicago, July SRW contracts shed 7.5 cents and closed the day just above $4.91. The September contract shed 7.75 cents and ended at $5.08 per bushel.

Down in Kansas City, HRW contracts for July shed 8.25 cents to end the day at $6.015. The September contract shed 8 cents to end the day at $5.285.

This afternoon, the USDA released its weekly update on crop quality on progress. Average trade estimates pegged wheat graded good-to-excellent at 34%.

However, the agency reported that wheat rated G-E came in at 36%.

The most notable gains in crop quality were evident in Illinois, which saw a jump from 53% G-E to 63% G-E.

In Minneapolis, the July spring wheat contract shed 3.5 cents to close the day at $6.015. The September contract shed 3 cents to end the day a tick below $6.09 per bushel.

The USDA reported weekly planting progress for spring wheat. Analysts expected the agency to report that 52% of spring wheat planting had been completed. However, it appears that farmers really caught up over the last week, as the table below illustrates.

The USDA says that 58% of the spring wheat has been planted. That figure represented a big jump from the previous week when planting sat at 30%.

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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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