PM Comments May 19 2025
Good afternoon. Corn futures paced the upside action at the CBOT on Monday, as a late-session flurry of buying left both old and new crop contracts near their highs for the day and was also enough to lift soybean and wheat futures to small gains as well. The $ index spent the day trading sharply lower which seemed to help raw material markets across the board, but otherwise, the week started on the slow side as far as news goes, while volume was on the lower side also.
CN finished Monday at 4.47 and 1/2, up 4 cents. CZ was up 6 and 1/4 at 4.41 and 3/4. Inside day for CN. SN closed at 10.50 and 3/4, up 3/4 of a cent. SX was up a penny and 1/2 at 10.37. Also an inside day for SX. WN closed at 5.29, up 4 cents. Products were mixed to start the week, July soybean meal closed at 291.10, down 80 cents/ton, and July soybean oil closed at 49.44, up 51 points. New lows for the move in meal, and an inside day for bean oil. Livestock markets closed mixed on Monday, with June live cattle finishing the day at 212.97, up 75 cents, August feeders finishing at 297.47, down 12 cents, and June hogs finishing at 99.25, down $1.07. Outside markets have also been trading mostly mixed, crude oil futures are trading either side of unchanged, the Dow Jones index is up 120 points, and the US$ index is down 60 points; the S&P500 and the NASDAQ are both near unchanged also. Gold futures have had an inside day and are up $45-50/oz.
Spreads were mixed/lower on Monday, with corn spreads closing up 3/4 of a cent to down 2 and 3/4, and soybean spreads were down 1/4 of a cent to down 2 and 1/4. CN/CU closed at 19 and 1/4, down 2 and 3/4, and SN/SQ closed at 3, down 3/4 of a cent.
USDA this morning started the week by announcing that private exporters reported sales of 145,000 mt's of soybean cake and meal for delivery to the Philippines during the 2024/25 marketing year. Of note, this is first flash sale of US soybean meal since early April, which was also to the Philippines.
Staying on the demand front, USDA also released weekly export inspections data this morning, which was the only real ag-specific piece of news the markets saw to start the week. The data, which was for the week ending May 15th, showed corn inspections in the week at 1.719 mmt's, which was up 32% from last week's total; soybean inspections were down just over 50% from last week at 218k mt's, and wheat inspections were up 5% from last week at 424k mt's. Cumulative inspections in the current marketing year have reached 45.543 mmt's for corn (+29% from last year) 44.132 mmt's for soybeans (+11% from last year), and 20.703 mmt's for wheat (+16% from last year). Typical pace would suggest corn inspections could see one or two more good weeks before beginning to seasonally decline, while also suggesting soybean inspections likely stay depressed through June and July before rebounding a bit into the end of the marketing year.
Aside from that, and as has been the case more often than not in recent weeks/months, the bulk of the headline news for Monday leaned political/geopolitical, with the day's main stories being a late Sunday-evening passing vote on President Trump's tax bill from the House Budget Committee, and then also reports out of the phone conversation that was had between Trump and Russian President Vladimir Putin. Starting with the tax bill, its being reported that four hardline Republicans who had voted against the bill last week changed their vote from no to present, which allowed it's passage without actually giving their full confidence in the measures it contained. Said one of the four, "we've made progress this weekend... but we didn't get nearly far enough." Nonetheless, the vote of passage by the Budget Committee now clears the way for a full-chamber vote on the measure sometime either late this week or early next week according to sources familiar with the matter; House Speaker Mike Johnson is pushing to have the bill fully approved by next Monday's Memorial Day holiday, but it is unclear today how realistic a deadline that is.
On the Russia front, Trump indicated in a post on his Truth Social platform that he and Putin had a two hour phone call earlier today that went "very well", but by our assessment yielded little of note as far as progress goes. Trump said that Putin had agreed to immediately begin conversation regarding a ceasefire as long as certain conditions were met, which has more or less been his stance since his country invaded Ukraine more than three years ago. It would appear the main hang-up seems to be Ukrainian land currently controlled by Russian forces, which it says Ukraine should cede to Russia, and has been a non-starter as far as negotiations on Ukraine's side goes. New in today's conversation though seemed to be more rhetoric between the US and Russian sides on trade deals similar to those being hammered out with other countries around the world; Trump said Russia had a "tremendous opportunity" to create massive amounts of jobs and wealth once the war was over, and added that the potential between the two was "unlimited." Trump also mentioned in his post that he had spoke with the leaders of France, Italy, Germany, and Finland, as well as the had of the European Commission and Ukrainian President Zelensky, and informed them of his conversation with Putin.
Weather remains the other ongoing theme of importance, with the US growing season here and run-to-run forecast changes having a considerable impact on futures price direction. Weekend rains were generally as expected across the northwestern Corn Belt and also the southeast (see picture below), with satellite data indicating 0.5-2" of precip falling through some of the drier areas of the Dakota's and Nebraska. Forecasts also show additional precip for these areas the first half of this week, with the EU model seeing an additional 1-3" between now and Wednesday evening for parts of MN/WI/IA/IL/MO. More scattered precip is then being forecast with a generally more southern/south eastern bias for the back half of this week, with heavier rains then expected for the OK/AR area through the weekend and early next week.
Extended range forecasts then into the opening days of June show above average precip potential throughout the southeast and eastern US, while areas to the west and also in the northern Corn Belt look to see average to slightly below average precip potential. Temperatures in the period trended warmer in the west throughout the day today, while the east is seen being average to slightly above average.