Market News

Another round of losses for grain, oilseed futures

Soybeans were lower on profit taking and technical selling. Most forecasts have dry, cool weather in much of the Midwest and Plains, which should help harvest speed up. IHS Markit is projecting production at 4.454 billion bushels with an average yield of 51.5 bushels per acre. The USDA’s next set of supply, demand, and production numbers is out Tuesday, November 9th. Planting and development conditions in South America generally look favorable ahead of the full emergence of the La Nina pattern, which could trim yields. CONAB’s next set of estimates for Brazil is scheduled for Thursday, November 11th. There was talk during the session, but no confirmation, of China buying beans from Brazil. The U.S. price advantage is only expected to last until early next year. The USDA’s weekly export sales numbers are due Thursday, November 4th at 8:30 Eastern/7:30 Central. Soybean meal was higher and bean oil was lower on product spread adjustments.

Corn was lower on profit taking and technical selling. Corn is also watching U.S. harvest activity and weather in Argentina and Brazil. IHS Markit has this year’s corn crop at 15.204 billion bushels with an average yield of 178.7 bushels per acre. Last week’s ethanol production was the second highest average on record. The U.S. Energy Information Administration says production averaged 1.107 million barrels a day, up 1,000 on the week and 56,000 on the year, with stocks at 20.129 million barrels, an increase of 204,000 from the week before and 454,000 from a year ago. Ethanol futures were unchanged. The USDA’s attaché for South Africa estimates 2021/22 corn production at 16.1 million tons, compared to 16.847 million in 2020/21, with exports of 3 million tons, compared to 3.5 million last marketing year.

The wheat complex was lower on profit taking and technical selling. Wheat is overbought but continues to have a bullish global supply situation. Even if demand for U.S. wheat exports remains slow, global prices are rising as the supply shrinks, including sharply higher prices for the world’s biggest exporter, Russia. Any significant relief for world prices might not be seen until Australia’s harvest gets underway early next year. Still, that’s expected to be somewhat limited as Australia primarily supplies portions of Asia. Domestically, most forecasts have drier weather in the eastern Midwest and rain in parts of the southern U.S. Plains, generally welcome in both regions. Globally, the trade is monitoring planting in Europe, Russia, and Ukraine, along with development weather in Argentina and Australia.

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