Afternoon Soybeans: Weaker trade for the soy complex.

The soybean market reversed back to the downside today with the weaker price action influenced by the Black Sea news this morning and a quiet stretch for fresh export activity.  July beans settled 12 lower but ended nearly 16 cents off the session low while the new crop November beans lost nearly a nickel with a similar recovery effort off the day's low.  In the cash markets, CIF bean bids were quiet while offers firmed higher.  Interior processor bids remain steady to firm as crushers push to pry bushels loose from the farmer.  

This morning Reuters reported that Russia was ready to provide a humanitarian corridor for vessels carrying food to leave Ukrainian ports in return for the lifting of some sanctions. While there is plenty of reason for skepticism over the relaxing of sanctions or any good faith efforts from either side during the ongoing war, the dialogue was still seen a positive development amidst concerns over food shortages for countries. This afternoon Interfax reports that Russia says it is opening two sea corridors from Ukraine's ports citing the defense ministry. We'll just have to see.

The US planting weather outlook features a mostly favorable mix of rain/sunshine. All eyes are on the N Plains region thanks to significant planting delays due to persistently cold and wet conditions. Fortunately, a window has opened for ND this week before rains are set to return again over the weekend. Where field conditions allow, most farmers in the area are prioritizing corn and spring wheat seeding ahead of beans. The prevent plant date for corn in ND starts today, the 25th, while spring wheat is the 31st for the northern half of the state and June 5th for the southern half. For the nuances of the prevent plant insurance program, read this University of IL article on the topic: https://farmdocdaily.illinois.edu/2022/05/prevent-plant-and-2022-acres-a-looming-issue.html


In the product trade, bean oil led meal to the downside with demand concerns in China due to the covid lockdowns; especially when combined with the optimism that Ukraine sunflower oil supply could return to the world markets. Chinese bean oil demand was reportedly down by 11% and 15% the past two months from normal. This helped pressure bean oil to a one month settlement low. Lost in the shuffle was the more than offsetting demand headline where India's soy oil imports would rise by 2.5 mmt on the year due to reductions in higher priced palm oil imports while the projected demand loss in China was 500 tmt. Board crush margins suffered an 8 cent drop basis the July to $1.20/bushel.

For tomorrow's weekly export sales report, the range of trade expectations for combined old/new crop sales of corn is .350-1.3 mmt, wheat 50-500 tmt, beans .300-1.4 mmt, meal 100-425 tmt, and oil 0-30 tmt. There was a daily sale of 10 tmt of old crop and 219 tmt of new crop beans to unknown for this reporting period.

Elsewhere in the news, Indonesia trade ministry will decide on palm oil producers' mandatory domestic sales volume that will allow the firms to resume crude palm oil exports after lifting the outright ban was lifted Monday.

Vegoil oil importers in India say with lower priced Soyoil taking a larger volume of import demand, the country's 2022 palm oil imports could fall by nearly 20% to an 11 year low at 6.7 mln mt. Soyoil imports could rise by 57% to around 4.5 mln mt.

Plunging demand for soyoil in China due to covid lockdowns is expected to cut demand for soybeans. Soyoil consumption fell by 11% and 15% the past two months from the same periods in 2019, before the Covid pandemic, according to estimates from Mysteel, a China-based commodity consultancy. It forecasts soyoil use at 16.7 mmt this year, down about 500 tmt from 2019.


Soybean Basis:
Location Spot
US Gulf off 1 to +143
Brazil Paranagua up 5 to +155
Sioux City, IA steady +20q
Mankato, MN up 5 to +55q
Decatur, IL steady +65n
Claypool, IN steady +50n
Columbus, OH steady -5n