Corn, wheat continue rally

Market News

Corn, wheat continue rally

Soybeans were mostly lower on spread adjustments, with November still hitting a new contract high and January up modestly. The trade is watching continued planting delays in South America and while there’s a chance of rain in parts of Brazil, much of Argentina could remain dry. Still, any further delays could push back the availability of Brazil’s beans and Argentina’s products by weeks or months, leaving the U.S. as the primary global supplier. The USDA’s attaché in Brazil is still expecting record 2020/21 soybean production at 131 million tons, compared to 125.6 million in 2019/20, with an expansion in planted area. 2020/21 exports are seen at 85 million tons, compared to 82 million in 2019/20. The crush estimate is unchanged at 44 million tons because of the tight domestic supply and strong export demand. AgroConsult has the crop at 133.4 million tons, compared to their last guess of 132.6 million. Brazil’s export association ANEC says October exports are projected at 1.911 million tons, compared to the estimated 3.945 million in September and the trade ministry’s October 2019 total of 5.2 million tons. China and unknown destinations both bought 2020/21 U.S. beans Wednesday morning, 132,000 and 120,000 tons, respectively, with chance more sales could be announced this week. The USDA’s weekly export numbers are out Thursday morning. Soybean meal was mostly higher and bean oil was mostly lower on spread adjustments.

Corn was modestly higher on commercial and technical buying, with December closing at a more than six-month high. Corn is also monitoring conditions in Argentina and Brazil, with delays for beans pushing back corn planting, limiting availability and potentially increasing demand for U.S. supplies. Export demand has been solid over the last couple of months, largely on better demand from China, which has already passed the USDA’s import outlook for the current marketing year, but most of that still needs to be shipped. Hurricane Delta is expected to impact shipping out of the U.S. Gulf. Ethanol production was up 42,000 barrels on the week at an average of 923,000 a day, but that was down 40,000 on the year while stocks held near a four-year low. The U.S. Energy Information Administration says the domestic supply was 19.672 million barrels, a decrease of 19,000 from the previous week and 1.552 million from a year ago. Ethanol futures were lower.

The wheat complex was higher on commercial and technical buying, along with lower trade in the U.S. dollar index. Dry weather is delaying winter wheat planting in the Black Sea region and could impact U.S. winter wheat acreage, depending on how long these events persist. Recent rain in Ukraine missed some of the drier areas, while Russia has remained very dry and drought is expanding in parts of the U.S. Plains. Some U.S. soft red winter growing areas will see rain attached to Hurricane Delta. There are also dry conditions in parts of Spain, while portions of France are seeing excessively wet weather during planting. All of those factors pushed December Chicago above resistance and helped December Kansas City hit a one-year high. New USDA supply, demand, and production numbers are out Friday, with most of the spotlight for wheat falling on the global side of the ledger. DTN says Tunisia bought 92,000 tons of wheat from an unknown origin, while Japan is tendering for 118,428 tons of food wheat from the U.S., Australia, and Canada, Thailand is in the market for 213,000 tons of optional origin feed wheat, and Pakistan is looking for 300,000 tons of wheat in an international tender.

Be the first to comment

Leave a Reply

Your email address will not be published.