Corn shrugs off broader market drop
November 26, 2021 By John Perkins Filed Under: Closing Futures / Livestock Briefs, Crops Markets, Market News
Soybeans were lower on fund and technical selling, cementing the lower weekly finish. Contracts were down on spillover from the broader market, which was concerned about new, emerging COVID strains. That pushed a lot of leading indicators lower, including the Dow and crude oil. Weekly export sales were solid at 1.6 million tons, with about half of that to China. Still, there’s talk that China could be buying more U.S. soybeans, with Beijing purchasing winter beans from Brazil, expecting an early harvest. That could be thwarted by an aggressive La Nina pattern, with dry weather already in issue in southern portions of Brazil. Soybean meal and oil dropped on the broad market losses, demand uncertainties linked to COVID, and position squaring ahead of next week’s first notice day for December contracts. Domestic crush demand continues to be a supportive influence for soybean products, in addition to tight soybean meal supplies in Argentina, the world’s biggest soybean product exporter.Corn was higher on short covering and technical buying, closing the week out with solid gains. Export sales were a marketing year high, mostly to Mexico, with China buying a small amount of U.S. corn. Demand from China has been slower than anticipated, with Beijing largely relying on Ukraine for its corn needs, despite the U.S. price advantage. Contracts were able to bounce back after the early, outside market influenced losses. Corn is also monitoring conditions in South America, especially the anticipated La Nina impact in Argentina and southern Brazil. For now, things generally look good, but planting remains slower than average in Argentina. Additionally, the spotlight for Brazil will fall on the second crop, which is planted after the soybean harvest. Ethanol futures were unchanged.The wheat complex was mostly lower Friday but finished the week higher in the most active months. Winter wheat was down on pressure came from the broader markets and overbought signals after the recent run to new highs. Minneapolis finished mixed, adjusting spreads. Export sales were up on the week, Japan led the way, but closing in on the halfway point of 2021/22, U.S. sales are behind 2020/21, even with a tighter global supply and rising Russian export tax. Drought is increasing in parts of the southern U.S. Plains, with little rain in the medium-term forecast. Drier than normal weather is also a concern in portions of the northwestern U.S. Plains and Ukraine, while wet weather is being watched closely in the eastern Midwest and eastern Australia. The trade is also keeping an eye on conditions ahead of dormancy in Europe and Russia, along with harvest activity in Argentina.
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