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Review of Agriculture Commodity Prices - May 2022

Review of Agriculture Commodity Prices – May 2022



Corn

The price of corn fell 6.13% in May and is up 11% since May 31, 2021.

The biggest issues in the corn market are production and geopolitical.

Of course, the Russian invasion of Ukraine will impact crop production for the foreseeable future.  President Vladimir Putin has said he is willing to facilitate export of grain from Ukrainian ports.[1]

In terms of production, it continues to be a slow start to planting in North America.  The corn planting season is running at its second slowest place in more than 25 years.[2]   Brazilian corn harvest (the safrinha crop) was 1.35% harvested as of May 31, 2022, compared to 0.45% last year and the 0.85% average.  Early yields are highly variable[3].  Brazil has experienced a cold May which can impact corn harvest there[4]  

Outlook: positive.

Soybeans

The price of soybeans rose 0.36% in May and is up 9% since May 31, 2021.

The biggest issues in the soybean market are China COVID 19 issues and production issues.

With China’s COIV-19 lockdowns, the demand for soybeans will be lower as restaurants are closed and the need for soy oil to fry food is lower.[5]  Having stated that, Chin’a April soybean imports from Brazil were up 120% verses  imports in March.[6]

In terms of soybean crush, the National Oilseed Processors Association announced April crush was 6.6% was lower than what was crushed in March but up 5.9% from April 2021.[7]

IN Brazil, soybean farmers will raise soybean plantings by 1.5% next year according to Agrinvest Commodities.[8] 

Outlook: Negative

Wheat

The price of wheat rose 2.06% in May and is up 59% since May 31, 2021.

The biggest issues in the wheat market are geopolitical concerns and production.

Just like for corn, the Russian invasion of Ukraine will impact the wheat market for the foreseeable future.   However, Russia is planning on exporting more in 2022 – the country has experienced a large harvest and has a large stockpile of wheat.[9]  

Wheat importers in Asia are scrambling for supplies after Indian export ban announced in mid May.[10] France indicated that their wheat production will be lower due to dry weather (France is the European Unions largest grain producer).[11] 

Outlook: Unclear.
 
 
 
[1] Reuters Inside Commodities – May 31, 2022
[2] Reuters Inside Commodities – May 24, 2022
[3] www.soybeanandcorn.com – May 31, 2022
[4] www.soybeanandcorn.com – may 23, 2022
[5] Reuters Inside Commodities – May 26, 2022
[6] Reuters Inside Commodities – May 20, 2022
[7] Reuters Inside Commodities – May 17, 2022
[8] Reuters Inside Commodities – May 5, 2022
[9] Reuters Inside Commodities – May 19, 2022
[10] Reuters Inside Commodities – May 17, 2022
[11] Reuters Inside Commodities – May 10, 2022