The short trading week in honor of Memorial Day did not stop corn from having its worst trading week of the year. July corn falling 7.77 to 7.27 and December corn falling from 7.29 ½ to 6.89 ½. The possibility of Russia allowing Ukraine to export grains through the Black Sea weighed on grain markets. The problem with this is Russia wants NATO to ease sanctions in return for letting the exports happen, but many countries do not want to ease the pressure the sanctions have put on Russia. U.S. corn planting progress was strong in this week’s report which also put pressure on corn prices. U.S. corn is now 86% planted which is only 1% behind the 5-year average. The problem states continue to be North Dakota and Minnesota which are 27% and 10% behind average pace. Despite the bearish influences on the corn market this week Ethanol was not one of them. Ethanol production increased 57,000 barrels per day to 1.071 million barrels per day. At the same time fuel ethanol stocks were down by 700,000 barrels.
Soybeans didn’t have a great week despite gaining 40-cents on Thursday. July soybeans fell from 17.37- ¾ to 16.99 ½ and November fell from 15.45 ¼ to 15.60 ½. China did step in and purchase some soybeans this week nearly 5 million bushels split between old and new crop delivery. The spread between the July and August contracts being at 64-cents is a sign of high domestic demand. Soybean planting in the US made strong progress at 66% complete, only 1% behind the 5-year average. North Dakota is the furthest behind at 23% planted with a 5-year average of 70%.
Chicago Wheat was the hardest hit from the potential Ukraine export news. July wheat fell from 11.57 to 10.41. Another bearish factor hitting the wheat market this week was some beneficial weather in both the EU and the US wheat growing areas. Winter Wheat conditions in the U.S. improved 1% from last week but are still extremely low at 29% good to excellent. Spring Wheat planting progressed 24% from last week to 73% planted. It’s getting very late to be planting wheat and we may see a good number of prevent plant acres.
Forecast for much of the corn belt calls for rain and below average temperatures for the next two weeks. This should help crops get off to a good start, but some areas may experience flood like rainfalls. Some areas of Missouri are expected to get 12 inches of rain over the next two week. Brazil has started corn harvest a week sooner than normal from the early maturing corn caused by the lack of rain. Many parts of Brazil have seen very little rain since late March and the forecast continues to be hot and dry.