Will China Buy U.S. Soybeans for a 4th Day in Row?

Good Morning from Allendale, Inc. with the early morning commentary for April 27, 2020.

Grain Markets were mixed with corn and wheat futures lower on consumption issues and favorable weather.  Soybean futures pushed higher as Chinese soybean purchases last month were sharply lower and stronger U.S. export sales.

Last week, July corn futures were down 5.75 cents, July soybeans were down 4.75 cents, July wheat down 1.25 cents, July soymeal was down $1.40 and July soyoil was down 112 points.

USDA Weekly Crop Progress Report will be released this afternoon at 3 p.m. CST.  Trade is expecting corn planting at 20-25% complete (7% last week, 12% last year, 20% average).  Soybean planting expected at 5-7% complete (2% last week, 2% last year, 3% average).  Hard red Spring wheat planting expected at 16–18% complete (7% last week, 13% last year, 36% average).  

CFTC Commitments of Traders showed funds new net position short -161,000 corn contracts, soybean contracts are even, long +24,000 wheat contracts, soymeal contracts are even and short -12,000 soyoil contracts.

USDA reported soybean export sales of 125,000 tonnes to Mexico and 136,000 tonnes to China.  They also reported export sales of 589,395 tonnes of corn to Mexico.

China’s March Brazilian soybean imports fell 24.8% from a year earlier, customs data showed, after rains delayed cargoes.  China imported 2.1 million tonnes of soybeans from Brazil, down from 2.79 million tonnes in March of last year, data from the General Administration of Customs showed.

The second wave of states is prepared to ease coronavirus restrictions on commerce this week, despite health experts warning there is still too little diagnostic testing.  Colorado, Mississippi, Minnesota, Montana and Tennessee are set to join Georgia, Oklahoma, Alaska and South Carolina in reopening businesses without the means to screen systematically for infected people who may be contagious but asymptomatic, and to trace their contacts with others they might have exposed.

USDA Cattle on Feed report showed On feed at – 5.5% under last year (-5% under last year expected), Placements at -22.7% under last year (-21% under last year expected), and Marketings are seen +13.1% over last year (+11.8% over last year expected).

U.S. Labor Department issued new guidelines for U.S. meatpacking and meat-processing plants that have seen a rash of coronavirus outbreaks, saying employees should be spaced at least 6 feet apart and screened before they start working.  “As essential workers, those in the meatpacking and processing industries need to be protected from coronavirus for their own safety and health,” OSHA’s deputy assistant secretary, Loren Sweatt.

Dressed beef values were higher with choice up 0.59 and select up 0.10. The Feeder cattle index is 119.48. Pork cut-out values were up 0.56.

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