By Kirk Maltais
--Corn for July delivery rose 0.6% to $3.19 1/4 a bushel on the Chicago Board of Trade Friday, with managed money traders eating into a sizable short position amid general uncertainty on the grains market.
--Soybeans for July delivery rose 0.2% to $8.38 1/2 a bushel.
--Wheat for July delivery fell 0.4% to $5.00 1/4 a bushel.
Short Shift: Corn traders covered their short positions, making a dent in the roughly net 200,000 contracts counted in the last CFTC commitment of traders report. Throughout May, corn futures have stayed range-bound around $3.20 per bushel after shedding nearly 9% through April.
Supply Squeeze: Drought conditions in the southern portion of Ukraine provided support for U.S. wheat futures. Ukrainian authorities presented their first estimates of the damage, with 385,000 hectares of winter crops lost, including more than 150,000 hectares of wheat, AgriTel said. Crop ratings in France also decreased overnight, and Germany's wheat crop is expected to be 2.9% smaller. "The global crop is likely getting smaller with Western Plains wheat in the U.S. dry and winter wheat in Europe impacted by lower acres," said Doug Bergman of RCM Alternatives.
Covid Contraction: The contraction in Brazil's economy in March was only the beginning, and the biggest impact of the coronavirus pandemic will only be seen in following months thanks to the country's late implementation of social distancing, according to Alberto Ramos, an economist at Goldman Sachs in New York. For grains traders watching the weakening Brazilian currency as a possible magnet attracting Chinese grain purchases, a shrinking Brazilian economy is a bad sign.
Crushing Victory: Demand for soy products like soymeal and soy oil remains strong, according to data from the National Oilseed Processors Association. NOPA said 171.8 million bushels of soybeans were crushed in April, down from 181.4 million bushels from the previous month but still the second-highest April crush figure on record. U.S. farmers are anticipating that the demand picture for soybeans post-coronavirus will likely be stronger than for corn, causing many to shift acres previously planned for corn growth over to soybeans.
--The USDA releases its weekly grain export inspections data at 11 a.m. ET Monday.
--The USDA releases its weekly crop progress report for the 2020/21 crop at 4 p.m. ET Monday.
--The EIA releases its weekly update on ethanol production and inventories at 10:30 a.m. ET Wednesday.
(Jeffrey Lewis contributed to this article.)
Write to Kirk Maltais at firstname.lastname@example.org