May 20 - The major stock indices traded just below record levels at midday as optimism reigns supreme on Wall Street at midday, with tech traders anticipating stellar quarterly results from Nvidia on Wednesday. The VIX Is trading just above 12, while the dollar index firmed to trade near 105.1. Yields on 10-year Treasuries are trading near 4.45%, while yields on 2-year Treasuries are trading near 4.84%, as both rise well off of last week's lows. Crude oil prices are modestly weaker today, after failing to sustain a move above $80 per barrel, while the grain and oilseed markets continue to post strong gains.
Wheat prices led the way higher as production estimates continue to slip lower for Russia, and as the focus now also shifts to emerging drought problems in Ukraine, as well as planting delays in the Canadian Prairies. Firm soybean bids in Brazil where flood waters continue to take their toll in Rio Grande do Sul supported soybean futures, while the slower crush pace supports meal and oil. The average trade guess for this afternoon's USDA weekly crop progress report includes a 1-point gain for winter wheat rated Good to Excellent to 51%. Corn planting progress is expected to rise 19 points to 68%, soybean planting progress rises 14 points to 49%, and spring wheat planting rises 15 points to 61%. I'm a tad higher than those trade estimates on soybean and wheat planting, while a couple of points slower on corn planting.
USDA inspected 47.7 million bushels of corn for export in the week ending May 16, as shown below, along with 6.8 million bushels of soybeans, 7.6 million bushels of wheat and 4.9 million bushels of grain sorghum. Virtually all of the grain sorghum was destined for China, along with 10.8 million bushels of corn and 0.3 million bushels of soybeans. That's right - just 0.3 million bushels of U.S. soybeans were shipped to China in the week ending May 16. The wheat marketing year ends at the end of this month. We'll have to see totals on uninspected donated wheat for the final tally, but it now looks like 2023-24 marketing year wheat exports will come in very close to USDA's target, if not slightly below it. Grain sorghum shipments are still on pace to end up about 15 million bushels above the current target.
Marketing year to date U.S. corn export inspections total 1.386 billion bushels, up 308 million bushels or 29% from the previous year's pace, and 21 million bushels above the seasonal pace needed to reach USDA's recently revised export target. Shipments seasonally trend lower through June, July, and August as Argentine new-crop supplies become available. Argentina's crop was just 25% harvested as of Friday, although that's close to the normal pace for mid-May. We should learn a great deal more about the scope of damage done to the crop by the leafhopper over the coming weeks, as well as about drought damage to the winter corn crop in Mato Grosso do Sul and Parana in Brazil. That will shape U.S. export demand as we close out the current marketing year, but especially as we start the next marketing year.
Marketing year to date U.S. soybean export inspections total 1.461 billion bushels, down 311 million bushels or 18% from the previous year's pace. The total still exceeds the seasonal pace needed to hit USDA's target for the year that ends on August 31 by 30 million bushels, but that gap is narrowing, and I expect that to continue to be the case through the summer unless Brazilian losses from flooding in Rio Grande do Sul are much worse than currently known. Two-thirds of Argentina's crop is now harvested, with just the last 15% of the crop in RGDS in southern Brazil left to harvest once the rains stop there.
