Market News

Mostly lower finish for corn, soybeans, wheat

Soybeans were mixed, mostly modestly lower, with nearby months down and far off deferred contracts up. Beans adjusted spreads, watching planting weather in Argentina and Brazil, along with harvest conditions in the United States. Planting conditions look good in most of South America, while the U.S. harvest pace should pick up steam again after some recent delays. The International Grains Council pegs 2020/21 world soybean production at 370 million tons, compared to 373 million in September, on smaller crops in the U.S., Argentina, India, and Ukraine. Brazil’s president says that nation is importing soybeans but didn’t mention the amount or who sold the soybeans. Brazil recently lowered import duties from outside of the Mercosur trading bloc to limit domestic price inflation. Weekly export numbers were good at more than 1.6 million tons, primarily to China and Mexico, even if sales were below average, because the last few weeks have had some pretty lofty totals. Still, that might be a sign that Chinese demand is slowing, at least for now. Soybean meal was up and bean oil was down, adjusting product spreads. A crush worker union in Argentina says more strikes are likely because a recent government bonus didn’t meet expectations.

Corn was mixed, consolidating after Wednesday’s losses. Corn also adjusted spreads, while monitoring conditions in South America and the United States. Mexico and unknown destinations bought U.S. corn and the weekly numbers were bullish, with sales over 2 million tons, mainly to unknown destinations and Mexico. From the daily sales, Mexico picked up a total of 1,432,550 tons, with 891,540 for 2020/21 and 541,010 for 2021/22, and unknown purchased 140,000 tons. According to reports, the head of China’s COFCO thinks 2020/21 corn imports could hit 17 million tons, but for now, the USDA is holding the guess at 7 million tons. That could change if China increases its tariff rate quota for corn imports, but there is always the possibility Beijing could cancel previously purchased corn. China has bought around 10 million tons of corn, most of that still unshipped. Ethanol futures were mostly weak. The USDA’s attaché in Argentina estimates 2020/21 corn production at 48 million tons, 2 million less than the current official guess, with 25% to 30% of the crop planted. Exports are seen at 33 million tons, 1 million below the last guess, with 8.2 million tons of the crop already sold, 2.5 million slower than last year’s pace. 2019/20 exports are pegged at 37 million tons. The International Grains Council projects 2020/21 world production at 1.156 billion tons, compared to 1.16 billion last month, on reduced expectations for the U.S., European Union, and Ukraine.

The wheat complex was mixed, with Chicago and Kansas City down and Minneapolis mostly weak. Most forecasts have more precipitation in parts of the U.S. Plains and the Black Sea region over the next few days. Still, after that, much of the Plains is expected to return to a warmer, drier pattern and while the rainfall in Russia has been welcome, it doesn’t appear to be a drought buster. The USDA’s attaché in Argentina estimates 2020/21 wheat production at 17.4 million tons, compared to the current official guess of 19 million, with 2020/21 exports at 11.2 million tons, compared to the 2019/20 sales of 13.1 million tons. 5.2 million tons of the 2020/21 crop has been marketed, with harvest expanding into southern production areas. The International Grains Council projects 2020/21 world wheat production at 764 million tons, compared to 763 million a month ago. The USDA’s next set of supply, demand, and production numbers is out November 10th. Weekly export numbers were neutral, with South Korea and Mexico taking the top spots. DTN says Jordan bought 120,000 tons of milling wheat from an unknown origin.

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