5.9.25 Tredas Weekly Recap
Weekly Action:
July25 Corn down 19 to $4.49’75
July25 Beans unch at $10.52’0
Dec25 Corn down 7 at $4.42
Nov25 Beans up 6 to $10.31’0
July25 KC Wheat down 26 to $5.16’75
June25 Hogs down 1.675 to $97.675
June25 Fats up 3.65 to $214.65
May25 Feeders up 3.90 to $298.15
Grains:
-Planting progress across the Midwest pushes forward with wide open forecast, along with fund selling takes corn/wheat lower throughout the week. Old crop corn values decline versus new crop. US and China Meeting set to take place over the weekend in Switzerland which creates elevated headline risk.
-May USDA grains report out Monday, May 12th at 11am ct. The report will include our first look at the new crop (25/26) balance sheets for both the US and the world. Mondays pre report commentary from RJ O’Brien analyst included at bottom of recap
-Weekly Export Sales Recap
Corn sales huge - higher than expected
Soybeans sales within expectations
Wheat new crop sales higher than expected - old crop sales minimal
-USDA reported multiple flash sales end of the week. Corn to Mexico, Soybeans to Pakistan
-Buenos Aires Grain Exchange in Argentina raised the country’s soybean crop estimate from 48.6 mmt to 50.0 mmt on better-than-expected yields to date with the harvest 45% complete. The Argentine corn crop estimate held at 49 mmts, but better yields expected as well with potential final production up 1-2 mmts to 50-51 mmts by final count. Corn harvest is 35% complete.
-The trade looks at upcoming potential US trade negotiations, spring weather, and US biofuel policy uncertainty to raise price volatility into the coming months.
Livestock:
Live cattle and feeder prices gained throughout the week into new all-time highs. August and September feeder cattle contracts eclipsed the $300 mark. USDA reported live cattle prices as high as $228/cwt (+14m basis) The trade announcement with the UK, anticipates a boost to US Beef exports. Supply in the US is down and lower imports from Mexico contribute to the shortage. Weights remain at record highs as well. If feed costs remain lower, that could be the trend into end of year.
Weather:
Warm and dry weather is forecast for the central part of the country over the next 10 days. Highs are expected to reach into the 90s for most areas. This will allow spring seeding to push ahead on a timely basis. Although, the heat will continue/start to draw down soil moisture at a faster rate.
Economy:
U.S. and the United Kingdom on Thursday announced a bilateral trade agreement that leaves in place Trump's 10% tariffs on British exports, modestly expands agricultural access for both countries and lowers prohibitive U.S. duties on British car exports. The impact Trump's tariffs have on the economy is a major focus. The US economy experienced a 0.3% decline in real GDP for the first quarter, primarily due to a surge in imports ahead of tariffs. Employers added 177,000 jobs in April, a slight slowdown from the previous month, while the unemployment rate remained at 4.2%. The Fed held interest rates steady for the third consecutive meeting. The March CPI report showed softer-than-expected inflation, with headline CPI down 0.1% month-over-month. Earnings season is underway, with 63% of market cap companies reporting.
Something That Probably Means Nothing:
Pope Leo XIV, born Robert Francis Prevost, is the first American-born (Chicago, Ill) pope in history. What do corn prices do in years of papal elections? Below is corn futures values on those days dating back to 1978.
Quote of the Week:
All that I am, or ever hope to be, I owe to my angel mother - Abraham Lincoln
Enjoy Mother’s Day Weekend!
*Summary of Pre-Report Commentary/Analysis USDA May 12 Reports from RJ O’Brien Randy Mittelstaedt*
Corn - Analysis of the 2024/25 U.S. corn balance sheet suggests the USDA is likely to increase its export projection in the upcoming WASDE report due to exceptionally strong recent sales, with total export commitments already significantly outpacing their current estimate; despite this, old crop ending stocks are expected to remain near the USDA's figure as a reduction in their feed/residual usage estimate is anticipated in the July report. Looking at 2025/26, the USDA is projected to use higher acreage and trend yield, leading to increased production, and potentially revise new crop export and feed/residual usage based on current old crop trends, resulting in an estimated 2025/26 U.S. corn ending stock range of 2.0-2.1 billion bushels.
Soybeans - Unlike corn, U.S. soybean exports are tracking closely with the USDA's projection, although a slight dip in recent crush rates raises the possibility of a minor downward revision to the total crush estimate for 2024/25, yet the USDA is expected to maintain the current old crop balance sheet figures. Looking ahead to 2025/26, the USDA is anticipated to use planted acreage and trend yield figures similar to their February outlook, resulting in a new crop supply level comparable to the current year; however, their initial yield and export projections appear optimistic given recent yield stagnation and shifts in global demand, suggesting potential downward revisions in the upcoming report, while new crop crush is expected to see a further increase.
Wheat - The 2024/25 U.S. wheat balance sheet is expected to remain largely unchanged in the upcoming report, as exports are on pace with the USDA's projection, although feed/residual usage is anticipated to be higher than the USDA's estimate but unlikely to be revised until July. The focus now shifts to the 2025/26 outlook, with the USDA's initial winter wheat crop estimate anticipated in the next Crop Production report; based on current crop conditions and historical harvesting patterns, the 2025/26 total winter wheat production is projected to be near last year's level, with increased HRW supplies offset by stable SRW supplies. Preliminary estimates for the overall 2025/26 U.S. all wheat balance sheet suggest similar total supplies compared to the current year, with exports expected to align with the USDA's earlier forecast, a decrease in feed/residual usage due to a larger expected corn crop, and a slight increase in ending stocks.
