Market News

Demand supports soybeans

Soybeans were higher on commercial and speculative buying, along with spillover from the outside markets. The dollar was lower while the Dow, gold, and crude oil were higher. Farmer selling is very slow, so the nearby supply remains tight and the trade’s watching South American conditions ahead of widespread planting. Informa Economics now sees 2012 U.S. planting at 77 million acres, up 1.2 million their September estimate. Soybean meal was steady to higher, following beans, and soybean oil was up sharply on the new record palm oil prices. China’s Ministry of Commerce estimates October soybean imports at 4.19 million tons, compared to 4.13 million for September. The National Oilseed Processors Association’s monthly member numbers show the bean crush at 110.313 million bushels, down on the month and year and considerably smaller than expected.

Corn was higher on technical buying and spillover from soybeans and the outsides. Farmer selling is slow and there’s talk of more new demand from China but gains were limited by Wednesday’s USDA supply and demand update. Weekly export sales were larger than expected and shipments were more than what’s needed weekly to meet projections. Informa Economics’ early 2012 planted area estimate has decreased 1.2 million acres from their last guess to 93.1 million. Ethanol futures were mostly higher. According to Dow Jones Newswires, feed mills in East Asia have recently purchased 500,000 tons of new crop corn from India. Ukraine’s Ag Ministry states the domestic corn supply as of October 1 is 3 million tons, with 1.3 million held on the farm.

The wheat complex was higher on short covering, technical buying, and the lower dollar. Weekly export sales were good and the trade’s looking at the possibility for more sales in the coming weeks. Still, the fundamentals remain bearish, especially on the global demand side of the balance sheet. Informa Economics projects 2012 U.S. wheat planting at 57 million acres, up 400,000 from the September estimate. The European Union, via Dow Jones Newswires, sees 2011/12 grain production at 277.4 million tons, which would be down .2% from 2010/11, adding wheat exports should be around 15 million tons, compared to 20.1 million in 2010/11. Also via Dow Jones, Canada’s government is expected to present a law ending the Canadian Wheat Board’s trade monopoly next week, possibly Monday. According to Ukraine’s Ag Ministry, grain stocks at the start of the month were 21.9 million tons, up 23% on the year, with wheat at 13.9 million tons, including 7.5 million in on farm stocks.

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