Market News
Soybeans up, while corn, wheat give back some gains
Soybeans were modestly higher on commercial and technical buying. The USDA made a bigger than expected cut to ending stocks, which could fall even further in the coming months as the 2020/21 marketing year only started September 1st. Most forecasts have more dry weather in parts of South America, potentially stressing what has been planted. That said – the USDA may have lowered the production guess for Argentina slightly, while Brazil, for now, appears to be on pace for another record crop, but those early planting delays should extend global reliance on U.S. beans. Brazilian grain group ANEC projects November soybean exports at 762,707 tons, compared to last week’s guess of 688,120. The USDA’s weekly export sales numbers are out Friday. Soybean meal was lower and soybean oil was higher, adjusting product spreads.
Corn was modestly lower on profit taking and technical selling. The USDA’s corn ending stocks estimate was also lower than expected thanks to strong demand and a smaller crop, but contracts were overbought and due for at least a slight correction. The USDA also raised imports by China and slashed Ukraine’s crop guess. APK-Inform says Ukraine’s prices have moved higher this week because of slow farmer selling, with 72% of planted area harvested, for a running total of 19.6 million tons. The trade continues to monitor conditions in South America, with the planting of Brazil’s critical second crop getting pushed back at least a few weeks, as that crop is planted after beans get harvested. For now, Brazil’s government is expecting record corn production. Brazilian grain group ANEC expects November corn exports to be 4.8 million tons, rising from last week’s expectation of 4.15 million. The USDA left Argentina’s corn crop guess unchanged from October, but that could come down as development progresses. Ethanol futures were lower. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Thursday.
The wheat complex was lower on profit taking and technical selling. The USDA made only minor changes to the U.S. and world wheat outlooks, leaving the overall fundamental outlook bearish. The global change was so minor, 1 million tons, that the USDA is still projecting a record carryover into 2021/22. Still, the USDA also didn’t adjust global production expectations as much as some were expecting heading into the report. Most forecasts have more dry weather in parts of Russia, the European Union, and the southern U.S. Plains ahead of the winter crop heading into dormancy. Stateside, the soft red winter growing area remains in better shape than hard red winter, but there are some areas of concern. DTN says Japan is tendering for 80,000 tons of feed wheat and Algeria is in the market for 50,000 tons of milling wheat.
Be the first to comment