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AgriVisor Morning MarketWatch

 
Wednesday, May 18, 2022
Now that planting is progressing across the United States trade will start to divide its attention between current weather conditions and what we may see over the next several weeks. A concern that is building in the market is the dry soils being reported across much of the Southern US and into the Plains. This is now starting to work its way into the Western Corn Belt and generating ideas of a possible drought during the growing season. The latest data shows nearly 14% of the US corn production area has been drier than normal over the past month. In the May WASDE report the USDA predicted an average corn yield of 177 bushels per acre for the US and if these dry conditions persist and spread that number will likely be lowered. Total corn production in the United States is already expected to fall 105 million bu short of demand for the 2022/23 marketing year and any yield loss will cause this to widen even more. The question will be how far the US corn yield would decline before the USDA starts to trim demand as well. There is less concern on soybeans at this time, but before long, trade will show more interest on potential yield loss there as well.  

Highlights
* US fuel costs keep rising  
* Fed showing more inflation worries  
* More countries expand GMO plantings 
* GMO yields seen as benefit for production  
* Importers showing more food supply concerns
* US planting is advancing quickly
* US export sales may be front-loaded 
* Light frost reported in Brazil 
* Drought continues in Argentina 
* Covid issues remain in China

Corn
* Ukraine May export pace 50% of last year 
* High prices deter global trade 
* Brazilian Safrinha acres larger than thought
* US commitments 92% of yearly forecast        
* Commitments 2% behind normal   
 
Soybeans
* China continues with reserve auctions  
* China to auction 500,000 mt Friday 
* Brazil yield to average 45 bpa this year  
* US sales above yearly forecast        
* Normally sales are 97% of yearly estimate      

Wheat
* Russia raises export forecast
* Russian crop record large      
* Drought lowering Argentine yields 
* Argentina approves GMO wheat production
* Census export data larger than USDA  
  
Livestock
* Wholesale beef firms 
* Pork cutouts rebound
* Managed money impacting livestock 
* Daily cattle slaughter +2.5% last week
* Daily hog slaughter +4.1% last week

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