Market News

Profit taking pulls soybeans, corn, wheat lower

Soybeans were lower on profit taking and technical selling. There’s rain in the near-term forecast that could boost yields in some of the drier parts of the region. The USDA’s most recent crop production estimate did show a record yield, but that’s likely to be trimmed, with a probable downward adjustment in planted area as well. Crush margins remain bullish and near-term domestic and global supplies continue to be relatively tight. Soybean meal was down on profit taking after establishing contract highs Wednesday, while bean oil was mixed, mostly lower, on spread trade and the lower move in crude oil. The USDA’s weekly export sales numbers were retracted by the Foreign Ag Service. The trade also has an eye on conditions ahead of widespread planting in Argentina and Brazil.

Corn was modestly lower on profit taking and technical selling. That rain in the forecast is too late for parts of the region, but should help in others, with the USDA expected to lower the yield guess September 12^th. Private crop tour yields this week did improve in Illinois and Iowa, but not enough to maintain the USDA’s most recent guess. The USDA could also lower the planted area figure following the most recent FSA data, if not next month, then in the coming months. Heavy early harvest delaying rains are in the forecast for parts of the Delta, also potentially impacting yield. Domestic demand is solid. The trade is waiting to see what changes the USDA will make to the retracted weekly export sales numbers. The initially reported numbers were surprisingly strong, even for this time of year, which marks the start of some major global buyers moving away from South America to the U.S.

The wheat complex was sharply lower on profit taking and technical selling. Wheat is watching the spring wheat harvest and conditions ahead of new crop winter wheat planting. Recent rainfall in parts of the southern U.S. Plains is definitely welcome, but more will be needed. The trade continues to monitor harvest activity, planting, and exports in Ukraine. Wheat continues to be a smaller than anticipated component of Ukraine’s resumption of trade through the Black Sea following the attack by Russia earlier this year. Wheat is also keeping an eye on drought impacts in Europe and China. The weekly export sales numbers were a potential sign of improved demand, but those numbers were retracted due to issues with the new reporting system.