Corn Futures Rise as Brazilian Currency Gains
By Kirk Maltais
--Corn for July delivery rose 0.5% to $3.20 1/2 a bushel on the
Chicago Board of Trade on Wednesday, with traders finding little
else to get excited about other than a stronger Brazilian real,
which makes U.S. grains more attractive.
--Soybeans for July delivery rose 0.2% to $8.48 1/2 a
--Wheat for July delivery fell 0.4% to $5.04 1/2 a bushel.
Real Life: The Brazilian currency traded 1.2% higher, marking
its fifth session in a row of gains. A stronger Brazilian currency
may make China more willing to buy corn and soybeans from the U.S.
instead of Brazil. How long the U.S. dollar weakens in comparison
to other currencies remains to be seen. "When the dollar basket
gets unwound, it tends to have a long tail, and we have just come
off a three-year upside run on the greenback," said Charlie
Sernatinger of ED&F Man Capital.
Crop Shop: About 70% of the U.S. corn crop is in good or
excellent condition, according to the USDA's first corn condition
report for the 2020/21 year. It's a turnaround from last year, when
the agency hadn't even begun to survey the crop given the lateness
of planting due to record wet weather.
Drifting Along: Outside movements generated by currencies,
trading of grains futures was generally quiet. An early rally
effort failed to garner sustained buying interest, AgResource said.
"End users see no reason to chase rallies while speculators appear
comfortable with their existing market bets."
Rainy Season: Rain in the Black Sea region is "quite favorable
for heading wheat and developing corn," according to agricultural
weather research firm DTN. Scattered rains are expected in the
Black Sea for the rest of the week, although dry conditions are
expected for other parts of Europe, keeping U.S. wheat futures
Dynamic Duo: Archer Daniels Midland and Marfrig plan to launch a
joint venture that will sell meat-alternative products in North and
South America, expanding on an existing partnership in plant-based
foods. The U.S. grain giant and the Brazilian meat processor have
plenty of company in the burgeoning sector, which hasn't been
slowed by Covid-19, and both are trying not to be disrupted by the
trend. The JV will be called PlantPlus Foods, with ownership split
70-30 between Marfrig and ADM.
--The USDA will release its biannual Farm Labor report at 3 p.m.
--The USDA will release its latest weekly export sales numbers
at 8:30 a.m. ET Thursday.
--The USDA will release its monthly agricultural prices report
at 3 p.m. ET Friday.
--The CFTC releases its weekly commitment of traders report at
3:30 p.m. ET Friday.
(Jacob Bunge contributed to this article.)
Write to Kirk Maltais at firstname.lastname@example.org
(END) Dow Jones Newswires
May 27, 2020 16:00 ET (20:00 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.