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Corn, soybeans down after USDA numbers

Soybeans were lower on commercial and technical selling, pulling beans to a lower weekly finish. The USDA raised production and new crop ending stocks outlooks following June’s upward revision in acreage. Old crop U.S. and world ending stocks were up on the month. Globally, the USDA did raise the old crop production and export guesses for Brazil and the old crop import outlook for China, all by 2 million tons each. Now, attention turns to trade relations with China and U.S. crop development weather. The next set of supply, demand, and production estimates from the USDA is out August 12th. Soybean meal and oil followed beans lower.

Corn was lower on commercial and technical selling, also ending the week lower after a bearish reaction to the USDA numbers. The USDA has corn production and new crop ending stocks down on the month, but still at relatively high levels. The USDA did lower old crop feed and fuel use projections, along with the new crop feed guess. These projections are as of July 1st, so any damage from recent or forecasted weather is not factored in. Most forecasts to have an extended spell of hot, dry weather in some key U.S. growing areas into the latter half of the month, but there are some uncertainties. Friday, China bought a total of 1,365,000 tons of U.S. corn, with 765,000 tons for 2019/20 and 600,000 tons for 2020/21. The new marketing year on corn starts September 1st. Ethanol futures were lower.

The wheat complex was mixed, with Chicago up, Kansas City down, and Minneapolis mostly weak. Winter wheat production is expected to be down 7% on the year, with a 2% decrease for spring wheat. Neither one of those were all that surprising because of reduced planted area. The domestic numbers did show a very tight supply of U.S. soft red winter wheat, helping Chicago post that good gain. New crop U.S. ending stocks were up on the month, while new crop world stocks were modestly lower. Even with the mixed finish Friday, the September contracts at the three major U.S. exchanges posed week to week gains. Friday, China purchased 190,000 tons of U.S. hard red spring wheat and 130,000 tons of hard red winter, both for 2020/21 delivery. Russia’s Ag Ministry has wheat production at 75 million tons, compared to the USDA’s new guess of 76.5 million and the year ago total of 73.5 million tons.

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