New-crop soybean and corn prices fall amid U.S. rainfall and increased plantings in Canada

Soybean and corn prices continued to fall this week amid rains in the central regions of the US corn belt, which has been hit hardest by the drought. Corn prices have completely lost the speculative growth of June, and soybean quotes have risen by 10% for the month.

Traders are taking gains ahead of the final U.S. plantings report, due June 30, as well as the June 1 quarterly inventory report and Canada’s acreage increase data.

According to Statistics Canada (StatCan), in 2023 soybeans will grow by 6.8% from the previous season from 5.27 to 5.631 million acres, canola by 3.1% to 22.08 million acres, and corn – up 5.6% from 3.62 to 3.824 million acres, although analysts’ average estimates for all crops were slightly lower.

Yesterday on the exchange in Chicago, the main futures fell in price:

• July soybean futures – by 3.1% to $533/t (-4.6% for the week, +11.6% for the month),
• November soybean futures – by 2.4% to $464.8/t (-9%, +9.5%),
• July corn futures – by 5.9% to $232.3/t (-13.5%, -0.7%)
• November corn futures – by 4.7% to $211.3/t (-17.3%, +2.3%).

Average daily U.S. ethanol production remains at a high of 1.052 million barrels, according to the EIA, which is supporting prices, especially given the decline in export demand.

According to forecasts, rains will pass in the central areas of the US corn belt this week, but the heat will remain at 31-33 ^o C, which will negatively affect soybean and corn crops.

Expected heavy rains in the arid regions of the Midwest of the USA will limit the growth of prices, even in spite of the long-term heat of more than 30 ^o C. And already in August, the competition on the world market with the new crop of Brazilian corn will intensify.

Wheat and canola harvests in the Northern Hemisphere are also putting pressure on soybean and corn prices. But data from Friday’s reports may lead to another speculative jump in quotations.