AM Comments May 6 2025
Good morning. Ag markets have seen quiet/small ranging trade so far in the overnight session to start Tuesday, with the grains slightly higher on a dead-cat-bounce in the crude oil market and the soy complex unchanged to lower on more pressure from the bean oil market. It would appear traders are getting to the 'buy the rumor, sell the fact' point on US corn planting progress, as it would appear the good pace noted in yesterday's weekly report is already old news. We've said it before recently but will repeat that we simply don't see a lot of reason for July corn to dip below the $4.50 level amid a strong export program and lack of ownership on the part of the US farmer. Should we get ideal weather over the next 3+ months then this sentiment obviously changes, but there's a lot of market left to trade between now and then. Corn futures to start Tuesday morning are trading unchanged to a penny higher, soybean futures are trading 1-3 cents lower, and the Chicago wheat market is trading 3-4 cents higher. Products are mixed, soybean meal is up around 50 cents/ton, and soybean oil is down 30-40 points. Outside markets are also trading mixed to start the day, with crude oil futures up $1.10-1.20/bbl, the Dow Jones index down 270 points, and the US$ index down 25 points; the S&P500 is down 40 points and the NASDAQ is down 200 points. Gold futures have continued their Monday rally so far and are up another $60-70/oz this morning.
Today's Reports: Monthly Trade Balance; API Energy Stocks
- Yesterday afternoon's weekly crop progress report from the USDA showed a jump of 16% in corn planting on the week to 40% complete as of Sunday the 4th, while soybean planting advanced 12% on the week to 30% complete. At the state level, IL continues to be the big laggard on corn progress, with this week's 32% reading 12% behind the five-year average; IA comparatively is just 4% behind average, and IN is 1% ahead of average.
- At the state level on soybean planting pace, IL is the only state behind average at just 33% complete compared to 34% on average; IA at 38% done is 4% ahead of average, while IN at 25% done is 5% ahead of average. At the national level, corn planting pace has slowed a bit and is now just 1% ahead of average, while soybean planting remains 7% ahead of average.
- On the wheat side of the report, winter wheat conditions improved another 2% in the G/EX category to 51%, which compares to 50% in the same week last year. Spring wheat planting advanced 14% on the week to 44% complete, and emergence was up 8% on the week to 13%; planting remains well ahead of the five-year average for the week, which is at 34%. To view our Mid-Co crop progress maps, please click here.
- Sources familiar with the matter say two vessels loaded with crops for export have run aground in the Parana River and are partially blocking the water way. The two ships left the Rosario export hub, but no details were given on their destination. The shipping agency in response has lowered drafts for navigation, but has not commented on when the blockage may be moved.
- Private Russian ag company IKAR on Tuesday said they now see the country's 2025 wheat crop at 83.8 mmt's, which compares to their previous estimate of 82.5 mmt's and the 2024 figure of 82.6 mmt's. The group also raised their export forecast for 2025 by 1.3 mmt's to 41.3 mmt's.
- News in the financial world for Tuesday is largely the same as was seen yesterday, with Trump's scheduled White House meeting with Canadian PM Mark Carney and the start of the Federal Reserve's two day FOMC meeting later today being the two main points of interest aside from ongoing trade deal/tariff discussions.
- Other news of note from overnight included reports that German conservative leader Friedrich Merz failed to secure enough parliamentary votes in an initial election to become Chancellor, and also reports that current Berkshire Hathaway CEO Warren Buffet would be staying on as chairman after his announcement yesterday that we would be stepping down as the company's CEO at the end of the year.
- Ridging has begun to settle into the upper Midwest, with satellite-based rainfall estimates showing dry conditions throughout a bulk of the Corn Belt; light/scattered precip was noted in the east as the cut-off low from over the weekend continued spinning through this area, but this moisture was mostly confined to OH and areas east of here.
- Forecast-wise though, there is little new in the last 24 hours; models continue to be in good agreement on a roughly 10-15 day period of warm and dry weather for most of the Midwest and Corn Belt, with moisture being shunned to the west and the east. This will open up good planting windows for producers to finish up seeding efforts in the north, but will cause flooding concerns in parts of TX/LA and other areas further along the Gulf Coast where rainfall of 3+" is expected between now and the end of the week.
- The week-two AI model from the EU is showing a return to a wetter bias for the eastern Corn Belt this morning, but the ensemble and the GFS model are both still showing drier conditions through most of the area which means this shift will need to be monitored. Extended temperature forecasts are still warm for most all of the country, especially the eastern half.