Market News
Soybeans end strong week on a modestly higher note
Soybeans were modestly higher on short covering and technical buying, ending the week with strong post-USDA report gains, with the most active months shooting more than $.40 higher. Most forecasts have more rain headed for Brazil and moderate precipitation in Argentina over the next week, but large parts of South America remain in a moisture deficit. The dry weather planting delays pushed back activity far enough the world will still need to rely on U.S. beans into early 2021. The USDA’s ending stocks estimate, already a seven-year low, will likely be drawn down further in the coming months. The Buenos Aires Grain Exchange says 20% of Argentina’s crop is planted, compared to 24% on average. Weekly export sales were a marketing year low, but at 54 million bushels, that’s a pretty solid week and indicative of just how good demand has been just over two months into the marketing year. Soybean meal was steady to higher on commercial activity and bean oil was mixed, consolidating, as palm oil moved lower ahead of the U.S. session. The NOPA member numbers for October are out Monday, with the crush estimated at 177.123 million bushels. COFCO says a crush facility in Argentina idled by a fatal accident earlier in the week as partially resumed operations.
Corn was modestly higher on short covering and technical buying, cementing the modestly higher week to week finish. Corn is also watching weather in South America, along with conditions for the tail end of the U.S. harvest ahead of the weekly numbers Monday. For Argentina and Brazil, corn planting has picked up steam after early delays, but Brazil’s critical second crop isn’t planted until beans are harvested. Weekly export numbers were bearish, with no outright sales to China. Still, unknown was the week’s biggest buyer and some of that will likely ended up headed to China, regardless of Beijing’s most recent import projection. DTN says a South Korean feed mill bought 130,000 tons of optional origin corn. Ethanol futures were higher. Strategie Grains estimates 2020/21 corn imports by the European Union and United Kingdom at 17 million tons, down 2 million on the month because of high prices, the smaller crop in Ukraine, and strong demand by China.
The wheat complex was modestly higher on short covering and technical buying, but December contracts still posted modest weekly losses. Most forecasts have a better rain outlook for the southern U.S. Plains but there are continued concerns about dry weather in the Black Sea region, especially Russia. The Rosario Grain Exchange has lowered its estimate for Argentina’s wheat crop to 16.7 million tons, 300,000 less than the last guess because of dry weather. That said – for now, the overall fundamental outlook for wheat remains bearish, with the USDA only lowering the ending stocks projection by a million tons on the month, leaving the carryover at record levels. The USDA’s next set of supply and demand estimates is out December 10th. Weekly export sales were down 50% on the week and 46% lower than average. According to data from Great Britain’s customs agency, wheat imports during September were 337,212 tons, up more than 100,000 from August and more than twice the total in September 2019.
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