Big gains for corn, soybeans, wheat after USDA numbers

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Big gains for corn, soybeans, wheat after USDA numbers

Soybeans were sharply higher on commercial and technical buying. The USDA lowered U.S. production and yield estimates, tightening ending stocks, even without a change to exports. If realized, U.S. ending stocks would be a seven-year low, and we’re not even a quarter into 2020/21. Brazil’s soybean production and exports were unchanged, while Argentina’s crop guess was reduced following the slow start to planting. CONAB says 55% of Brazil’s soybean crop is planted, compared to 56% a year ago, with production estimated at 135 million tons, adding year to date exports are 81.4 million tons, very close to the total projection of 85 million tons. China’s government left imports unchanged from last month at 95.1 million tons, compared to the USDA’s guess of 100 million, but that could be pinned to the difference in how marketing years are gauged. Soybean meal and oil posted solid gains on the strength in beans and demand expectations. Grain port workers in Argentina reportedly launched a new round of wage strikes Monday.

Corn was higher on commercial and technical buying. U.S. corn production and yield projections were also lowered, while exports were higher, leading to a lower than expected ending stocks estimate. If stocks meet the USDA’s current guess, it’d be a seven-year low, and the marketing year runs through the end of August. The USDA left South American production estimates unchanged and raised the import guess for China to 13 million tons. For its part, Beijing left its import estimate unchanged from October at 7 million tons, even as rumors swirl about the possibility of a hike in the tariff rate quota. China also left production unchanged, despite expectations for typhoon related crop loss. CONAB estimates total corn production for Brazil at a record 104.9 million tons, with exports seen at 34.5 million tons. CONAB did report October corn exports for Brazil were down sharply as the market turned its attention to U.S. corn. Ethanol futures were higher. The U.S. Energy Information Administration’s weekly ethanol production and supply numbers are out Thursday, delayed a day by Veterans Day. South Korea bought 130,000 tons of 2020/21 U.S. corn.

The wheat complex was higher on commercial and technical buying. U.S. ending stocks were lower than expected on higher feed and food use, with no change to exports. World ending stocks and production were down modestly on the month, but the global supply is still at record large levels. The next set of supply, demand, and production numbers is out December 10th. Until then, the trade will continue to watch weather, including the impending dormancy for winter wheat in the northern hemisphere. The USDA’s attaché for Canada says 2019/20 trade year wheat exports were 23.453 million tons, compared to 24.452 million in 2019/20, but that could rise to 25 million tons in 2020/21. Production this marketing year is seen at 34.145 million tons, compared to 32.670 million last marketing year. CONAB says 80% of Brazil’s wheat crop is harvested as of last Friday. DTN says Ethiopia bought a total of 600,000 tons of wheat, while Jordan is tendering for 120,000 tons of milling wheat and Iran is in the marketing for 60,000 tons of milling wheat.

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