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Firm Friday close for corn

Soybeans were lower on fund and technical selling, still closing mixed for the week. Planting in Brazil is past 75% and Argentina is nearing the halfway point, with near-term improvements in weather in much of South America. Forecasts have the potential for more rain in central Brazil into mid-month, but southern Brazil remains excessively wet. Unknown destinations and China bought a combined 330,000 tons of 2023/24 U.S. beans, bringing the total for the week to 587,300 tons. That fulfills some of the trade rumors from the past week. Soybean meal and oil were down on fund selling and the recent slowdown in export demand for products. That slowdown is despite a decline in farmer selling in Brazil due to uncertainties about this year’s crop and many Argentina farmers suspending sales until the inauguration of their new president. The USDA says October’s soybean crush was a record for any month at 201 million bushels, 26 million more than the previous month and 4 million higher than a year ago, with soybean meal and oil production also seeing corresponding increases. Domestic crush margins remain bullish.

Corn was modestly higher on short covering and technical buying, cementing a firm weekly finish. Corn is watching planting and development conditions in Argentina and Brazil, along with the very tail end of the U.S. harvest. CONAB’s updated outlook for Brazilian production is out December 7th, with new USDA supply and demand estimates on the 8th and the department’s preliminary 2023 corn and soybean production totals in January. U.S. export prices are the best on the market following a rally in Brazil. That showed up in the most recent report, with weekly sales at a marketing year high, just short of a quarter into 2023/24. China was the biggest buyer, but most of the recent demand spike has been due to Mexico, with China reportedly purchasing primarily from Brazil. The USDA says corn for ethanol use during October was 461.479 million bushels, up 7% from September and 3% from October 2022, with DDGS production of 1,796,272 tons, up 6% on the month and 3% on the year. U.S. ethanol margins continue to hold in positive territory.

The wheat complex was mostly higher with Chicago and Kansas City up and Minneapolis mixed, even as the most active months posted solid gains in all three pits. Movement out of the Black Sea has slowed down due to weather, higher prices in Russia, and the ongoing war in Ukraine, but many of those sales are reportedly going to the European Union. Most of that’s been reported as France and even if China is purchasing for delayed delivery, aside from the most recent export sales report, most of that business has not gone to the U.S. Still, U.S. soft red winter is now extremely competitive on the global market, which is expected to boost sales, and China was the leading buyer last week, with U.S. sales the largest in six weeks. Also bullish for wheat are tighter domestic supplies and global weather issues, including recent heavy rain delaying harvest and lowering quality in parts of Australia. U.S. winter wheat conditions ahead of dormancy are generally much better than a year ago, but parts of the central and southern Plains remain locked in some form of drought. Statistics Canada’s updated production numbers are out Monday.

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