This edition of DATAGRO’s weekly analysis by grain analyst Flávio Roberto de França Júnior brings the full assessment to the latest US Department of Agriculture (USDA) supply and demand report released on the last day of May.
Soy
On the trading day of the report, the spot contract (May) oscillated between strong and moderate highs, closing at a value of US $ 6.00 / bushel, directly reflecting the above-expected reduction in US inventories of the current crop, as in the first indication for the new season.
However, the rise did not hold on to the next trading session, hampered by the lack of news in the US-China trade negotiation as well as weak US demand and strong weekly planting advance.
Corn
With regard to the numbers, the revisions of the projections were predominantly positive for prices. However, two pieces of information were negative: increase in current US season inventories higher than expected and the first projection of the new harvest with stocks also higher than expected.
On the other hand, the positive ones were: reduction in production in Brazil larger than expected; new US crop well below expected; world inventories of the current and new crop short of expected. On the day of the report, the spot position closed steady, also declining moderately on the next trading day, on top of significant US planting advance, and a sharp decline in wheat.
Wheat
The report brought more positive than negative price data. However, the negative data prevailed for the market, involving higher than expected final US crop output in the US and the production of the new cycle also above projected.
On a positive note, US inventories of the new crop and world inventories of the two harvests. In addition to the USDA, the market was also pressured by improved weather for the winter season and improved planting of the spring crop. On the day of the report, the spot fell sharply at $ 6.75 / bushel.