Grain Tidbits - May 25, 2018

9:43 AM 5/25/2018

As of this morning, tensions seemed to have eased with North Korea.  Yesterday, President Trump's announcement of scrapping talks between the two countries turned commodity markets lower.  This morning's ideas that North Korea is signaling a willingness to continue have brought  these markets into positive territory. This has let markets add weather and demand risk premiums into the market.  The US will be hot for the long Memorial Day weekend.  Markets are still monitoring weather conditions in the Ukraine as well, due to dry conditions persisting.

The Chinese government is seen nudging state grain buyers to increase purchases of US soybeans. 

Corn has been supported this week on the outlook for declining world stocks.  Large US carrying stocks offer resistance along with producers actively marketing both old and new crop corn at values not seen for nearly two years.

USDA is forecasting the first year on year decline in world wheat stocks since 2012.  World production for 2018/19 marketing year will not keep up with world demand.  While this alone is not bullish, weather adversities that have already reduced the US wheat crop could also be lowering key export crops in Canada, Australia, Black Seas, and the EU.  Couple this with USDA's forecast for a steep decline in world corn stocks and this makes the market find a floor of support.