By Kirk Maltais


--Corn for July delivery fell 2%, to $5.84 3/4 a bushel, on the Chicago Board of Trade on Tuesday, in response to new confirmation from the USDA that China has canceled more U.S. export purchases - with corn from elsewhere cheaper to buy.

--Wheat for July delivery fell 1.6% to $6.43 1/2 a bushel.

--Soybeans for July delivery fell 1.4% to $14.14 1/4 a bushel.


HIGHLIGHTS


Fresh Cut: The USDA confirmed this morning that China has canceled more export sales of U.S. corn that it had previously agreed to, with 272,000 metric tons of U.S. corn now canceled for delivery into the U.S. for the 2022/23 marketing year. The announcement comes after a streak of cancellations announced by the USDA for exports to China late last month. It also comes amid indications of a strong crop coming in the U.S. - with concerns that demand won't balance that production.

Surging Progress: Corn and soybean planting in the U.S. is now well ahead of the typical pace, putting pressure on futures as a large U.S. crop seems to be increasingly likely. In its Crop Progress report yesterday, the USDA says that 49% of U.S. corn has been planted so far this year through May 7 - exceeding the 4-year pace of 42%. Meanwhile, 35% of U.S. soybeans have been planted, which is also well over the 21% 4-year average. Spring wheat remains behind its normal pace, but also jumped from the previous week, with progress now at 24%.

Debt Ceiling Debate: A risk-off approach towards trading amid the threat of federal government default looms impacted commodities across the board, but appearing to be especially present in agricultural and soft commodities. Meetings between President Biden and House Speaker Kevin McCarthy commenced today, with weeks of discussions expected to ensue before the June 1 deadline.


INSIGHT


Report Prep: Analysts surveyed by The Wall Street Journal are expecting Friday's WASDE report from the USDA to show only small adjustments to the size and scope of U.S. crop-growing areas. The first indication of the size of the U.S. crop in the new marketing year is important, and seen as more important this year amid strained supplies elsewhere. Analysts are forecasting for U.S. production of corn to rise to 15.1 billion bushels and soybean production to rise to 4.48 billion bushels - this while slightly higher ending stocks are also expected.

Summer Rush: Analysts surveyed by Dow Jones are forecasting daily production of ethanol to climb in this week's report from the EIA - with analysts estimating production to range anywhere from 970,000 barrels a day to 997,000 barrels a day, versus 976,000 barrels a day reported last week. If ethanol production does rise, it would come right ahead of the start of the summer driving season - when Americans tend to take more road trips.


AHEAD


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

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

--The USDA will release its monthly world supply and demand report at noon 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

05-09-23 1512ET