By Kirk Maltais


--Soybeans for July delivery fell 1.4% to $12.30 a bushel, on the Chicago Board of Trade Tuesday, with better weather in North and South America supporting crops in the U.S. along with its competitors.

--Corn for July delivery fell 0.3% to $4.63 1/4 a bushel.

--Wheat for July delivery rose 0.8% to $7.02 3/4 a bushel.


HIGHLIGHTS


Status Update: Traders and analysts traded risk-off on corn and soybeans Tuesday, ahead of the USDA's next Crop Progress report due out this afternoon. The report is expected to show U.S. crops having the best soil moisture since 2019. Improving weather in Argentina is also a key factor pressuring CBOT soybeans. "Weather in Argentina seems to be improving, which should allow soybean harvest to advance and they should be in a position to export soybeans and meal," Brian Hoops of Midwest Market Solutions said.

Cut Down to Size: Russia's winter wheat woes continue to impact the expected size of the crop--with SovEcon marking its estimate for the Russian wheat crop down to 82.1 million metric tons from 85.7 million tons previously. "Our revised forecast accounts for the losses incurred after the May frosts," said Andrey Sizov of SovEcon. "However, current weather conditions remain challenging for the new crop." Sizov says that many key areas are too dry, with temperatures expected to rise in the next few days.


INSIGHT


Onto the Next Stage: Volatility is expected moving forward in grains, as farmers are in the latter half of the planting season and entering the summer growing stage. "Grain futures prices continue to gyrate on slow planting concerns, soggy U.S. weather forecasts and global weather worries," Naomi Blohm of Total Farm Marketing said in a note. "The month of June will bring additional fundamental news into the fold, likely allowing for plenty of price volatility." Traders typically adjust their positions in grains ahead of the end of the month.

Money Flow: U.S. agricultural futures are seeing a sharp increase in open interest held by traders. JPMorgan Global Commodities Research said open interest rose 5.6%, or by $16.89 billion to $316.97 billion for the week ended May 24. Appetite for wheat and soybean futures were behind the rise, said JPM in a note. The war between Russia and Ukraine continues to be a threat for wheat production and export volumes. "World wheat markets have rallied to 10-month highs as consumers have extended forward cover and investors continue to cover short positions," said the firm.

Big Business: The USDA said today that 215,000 metric tons of U.S. corn was sold to Mexico for delivery in the 2023/24 and 2024/25 marketing years--with 165,000 tons sold for delivery for 2023/24 and 50,000 tons sold for 2024/25. The purchase comes as drought hits Mexico's corn crops, giving analysts reason to believe that Mexico may become an even bigger buyer of U.S. corn. "A drought could generate even more export business for the U.S.," said Tomm Pfitzenmaier of Summit Commodity Brokerage in a note.


AHEAD


--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Thursday.

--The USDA will release its weekly export sales report at 8:30 a.m. ET Friday.

--The CFTC will release its weekly Commitment of Traders report at 3:30 p.m. ET Friday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

05-28-24 1529ET