Evidently the shorts in the wheat market have decided to take on the role of the Medieval Barber/Surgeon believing that if they let out enough blood from the bulls, the ills that plague him will be cured. Of course we could come up with all sorts of analogies and metaphors comparing the two but suffice it to say, they have let out so much blood at this point the patient is looking pretty peaked and it is touch and go as to if we can keep it alive. After the largest single day loss since December more blood has been spilled overnight and once again we are back visiting the 5.00 zone in wheat.
While I suspect the trade is already looking beyond the progress reports from last week and focusing more on the weather forecast ahead, the numbers appear to lean just a touch to the supportive side. Winter wheat conditions actually dropped 2% in the good/excellent category and now stand at 42%. This is still better than a year ago at this date when that category was just 34%. Winter wheat headed was 6% compared with an average of 8%. Spring wheat planted is at 17% which is actually 6% ahead of average but quite understandable with the dry conditions seen to this point in the Plains states. While certainly not a surprise, the first official report for corn planting has us at 2% complete, which compares with a normal 5%. Texas is up to 46% done compared with 54% average, North Carolina at 25% versus an average 28% and Kansas at 14% compared with a normal 8% but for the rest of the 18-states that produce the majority of the corn in this nation, none were in double digits. While all of this may heighten concerns a touch, at this date and what appears to be generally favorable weather forecasts, not enough to stimulate buying.
Export inspections slipped for both corn and beans but were higher for wheat but in the case of the latter, it would classify as too little too late. Corn inspections totaled 33.7 million bushels, which was down 17.5% from last week and 7% below the 10-week average. With 20 weeks left in the marketing year we now need to average 42.4 million per week to reach the USDA target of 1.8 billion. Beans slipped lower again as last week as we loaded 16.5 million bushels which was down 21% from last week and 43% from the 10-week average. I thought the USDA may have raised the projection in the reports last week but it was left at 1.79 billion so we need to average 6.2 million per week moving forward to hit that target. Wheat inspections were 20% higher than last week at 16.7 million bushels. While at face value you could say it was a step in the right direction but even with the recently reduced projection of 880 million for total exports, we need to average 22.9 million per week for the next 7 weeks to reach that goal. To date this year we have been averaging 16 million per week.
The date on the calendar at this point is kind of a two edged sword. It is early enough yet that there we have ample time to get crops in the ground but it is also early enough that we have all the uncertainty of the actual growing season ahead of us. Accordingly, I believe we should be approaching what should be the low end of trading ranges, particularly for wheat, and prices will continue with the overall sideways pattern into the summer months.