PM Comments May 14 2025
Good afternoon. CBOT markets saw mostly directionless price action on Wednesday for a second consecutive session this week, as corn and beans saw trade on either side of unchanged throughout the session today, while wheat futures spent most of the day trading higher on profit taking/short covering.
CN closed mid-week at 4.45 and 1/2, up 3 cents. CZ was down a half cent at 4.40 and 1/2. Inside day for CN. SN closed at 10.77 and 3/4, up 5 and 1/4. SX was up a penny and 3/4 at 10.61 and 1/4. New highs for the move in both. WN closed at 5.24 and 3/4, up 7 and 1/2 cents. Products were mixed, July soybean meal closed at 291.90, down $1.40/ton, and July soybean oil closed at 52.32, up 84 points. New highs for the move again in bean oil. Livestock markets closed lower, June live cattle were down $2.37 at 213.95, August feeders closed at 301.97, down $4.02, and June hogs closed at 98.85, down 65 cents. New contract highs and also outside days lower for both of the cattle markets and an inside day lower for the hog market. Outside markets are trading mixed/quiet, crude oil futures are down 60-70 cents/bbl, the Dow Jones index is down 110 points, and the US$ index is up 10 points; the S&P500 is unchanged and the NASDAQ is up 120 points. Inside days for crude oil and the S&P. Gold futures are down $60-70/oz.
Spreads finished the day mixed/higher, with corn spreads unchanged to 3 and 1/2 cents higher, and soybean spreads also unchanged to 3 and 1/2 cents higher. CN/CU closed at 18 and 1/4, up 3 and 1/2 cents, and SN/SQ closed at 3 and 1/4, up a penny.
From a news standpoint, there wasn't a ton new for Wednesday, with Trump's Middle East visit limiting his comments on the broader trade situation and the weather forecasts remaining mostly unchanged from previous days. Debate over the new crop balance sheets will be ongoing, but as things stand today, there isn't a lot from an agronomic standpoint to be concerned about as it pertains to corn and soybean production; there is maybe a little too much water in the southern Corn Belt and maybe soil moisture levels in the north/northwest could be a little better, but for the most part, it has been a fairly favorable spring growing season which at least leaves WASDE production estimates as plausible for the time being. Looking at the bigger picture as we get into the summer months, the bottom line remains that the bull camp will need some sort of weather or trade deal based rally to push values back towards last summer's highs following record production out of Brazil and the prospects of record production coming for the US.
Ethanol production data from the EIA's weekly report this morning came in a bit on the disappointing side, as production in the week ending May 9th was seen at a marketing year low of just 993k bbls/day. The figure was down 2.6% from last week, but was still up nearly 3% from the same week last year. Stocks in the week still saw a build despite the lower than expected production numbers, and came in at 25.445 mil bbls; this was up 1% on the week and was also up more than 5% from the same week last year. We estimate corn usage in the week at 98.1 mil bu , which is also a marketing year low, and brings cumulative corn usage in the year to 3.800 bil bu; this compares to 3.695 bil through the same week last year and the USDA's full marketing year forecast of 5.500 bil bu. The EIA data also included weekly petroleum stocks figures, which showed crude oil stocks in the week up 3.454 mil bbls to 441.83 mil, gasoline stocks in the week declining 1.022 mil bbls to 224.706 mil, and distillate stocks in the week declining 3.155 mil bbls to 103.553 mil.
Following up on the 45Z news from yesterday, the House Ways and Means committee on Wednesday advanced the 389-page tax proposal that was the topic of debate on Tuesday following an overnight meeting that saw countless amendments from mostly democratic committee members get rejected, as well as ample debate over the impacts of the bill. Sources say the Republican-led House of Representatives would like to put the bill to a full party vote by the end of next week, but it will have to make it through several more committees in the meantime before doing so. Nonetheless, soybean oil futures again took the news as positive as the progress is seen as a step in the right direction, with any guidance generally better than the 'retroactive credit giving' that has been going on for the past several years.
Again not a lot new on the weather front today for the Midwest, as forecasts continue to see a pair of low pressure systems bringing rainfall and thunderstorm activity to the Midwest over the next few weeks. The first system, set for the end of this week, will have a more northern track, while the second system then next week will track further to the south and hit more of the Central Corn Belt. The EU model shows rainfall totals from the two systems reaching 4-6" in the west, with a lesser 1-2" inches seen for the east. Extended forecasts then continue to show a shift back to drier conditions across a lot of the country into the end of the month, which means the coming moisture boost will be important. Temperatures have trended cooler in the last couple days, as once the above average warmth the back half of this week passes models see mostly average to below average temps for most of the Corn Belt in the 5-10 day period; the 10-15 day outlook also keeps extreme heat confined to the western third of the country, which will help to limit crop stress into the opening days of June.