Grains Sharply Divided in the Overnight

Grains were sharply divided overnight with wheat seeing big losses while soybeans rallied as much as 7 cents before backing off into the break. Corn was weaker as well in the night trade.

Soybeans got a lift from a bullish palm oil report Sunday night. Malaysia's palm oil stocks at the end of March fell 13.1% to 1.89 MMT from 2.17 MMT. Exports rose 22.9% to 1.33 MMT tonnes in March. Participants in a Reuters poll expected stockpiles to fall 10.3%t to 1.95 MMT, and exports to rise 12.4% to 1.22 MMT.

Wheat came under pressure hitting lows established in early March as forecasts for widespread rains across the U.S. Plains over the weekend eased worries about yield losses. Long-term weather forecasts call for rains in the U.S. Plains. This pattern seems to have strengthened and now heavy rainfall is expected over Saturday and Sunday. Russia's wheat export prices are expected to fall 4% from current levels when the new crop is delivered to the market, IKAR, one of the leading Moscow-based agriculture consultancies, said on Monday. Prices for the new wheat crop with 12.5 percent protein content and for August delivery are quoted by market participants at $176.5 per tonne on a free-on-board (FOB) basis in the Black Sea now, Dmitry Rylko, the head of IKAR, said. The current spot prices are $183 per tonne, he added.

Oil prices slipped on Monday after banks dampened hopes that the result of next Sunday's meeting of producers in Qatar aimed at freezing current output levels would improve the current supply-demand balance. Analysts at Goldman Sachs, who expect oil prices to average $35 a barrel in the second quarter, cautioned the outcome of the meeting may end up being bearish for the market. "A production freeze at recent production levels would not accelerate the rebalancing of the oil market as OPEC (excluding Iran) and Russian production levels have this year remained close to our 2016 average annual forecast of 40.5 million bpd," the analysts said.

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—Kevin McNew