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Anticipated shift in weather pressures soybeans, corn

Soybeans were lower on fund and technical selling, pulling contracts to weekly losses. There was rain in parts of the region over the past week and temperatures could moderate in some areas soon. That should help ease some stress in parts of the region, preserving some of the yield potential for this year’s crop. China, Mexico, and unknown destinations all bought new crop U.S. beans Friday morning, 325,000, 171,460, and 413,000 tons, respectively. Those sales brought the announced sales total for the week to 1,787,460 tons, all for 2023/24 delivery, after September 1st. Soybean meal was down, following beans, while bean oil was mixed on bear spreading. Crush margins remain bullish.

Corn was lower on fund and technical selling, ensuring a modestly lower weekly finish. Corn was watching the weather and the potential for a less stressful pattern, but parts of the Corn Belt are still expected to be hot and dry. Some yield potential has been lost and nearly 60% of the Midwest remains in some stage of drought, even with recent improvements in precipitation. The USDA’s next round of yield and production estimates is out August 11th. The trade is also watching Brazil’s ongoing second crop harvest and the export pace out of the Black Sea region. Brazil and Ukraine have both become key corn suppliers to China.

The wheat complex was lower on fund and technical selling, with the most active months at the three U.S. pits finishing the week mixed. There was no real fresh news out of the Black Sea region and the war’s impact on Ukraine’s export capabilities. Russia did attack export infrastructure earlier in the week but shifted focus after a couple of days. Russia continues to dominate the export market and Ukraine’s exports out of the Black Sea region have effectively stopped. Large parts of the spring wheat region remain dry, limiting yield potential in the northern U.S. Plains and Canada. Conversely, recent rainfall has improved conditions in Argentina, which is expected to see a rebound in production after three consecutive La Nina events. Still, the vast majority of exported wheat is from the Northern Hemisphere.

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