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Soybeans bounce as corn, winter wheat see more selling

Soybeans were higher on short covering and technical buying. Soybeans were due for a bounce, still watching the weather, expecting a generally cooler, wetter weather pattern in some key growing areas this week. That should help preserve yield potential in parts of the region. Still, with the USDA’s national condition rating down on the week, near multi-year lows, some yield potential has likely been lost. Soybean meal and oil futures followed that bounce in beans. The USDA says June’s soybean crush was 175 million bushels, 14 million below the previous month, but up 1 million on the year, with soybean meal and oil production also down sharply on the month, but up slightly from a year ago. China says it will auction 461,400 tons of previously purchased beans from state reserves Friday, August 4th.

Corn was modestly lower on fund and technical selling. The USDA’s corn good to excellent rating dipped, but conditions are expected to stabilize or even improve with this week’s weather. The USDA’s updated yield projection is out Friday, August 11th. The U.S. Energy Information Administration’s weekly ethanol numbers are out this Wednesday. The USDA says corn for ethanol use in June was 441.479 million bushels, with DDGS production of 1,787,735 tons, both up 1% from May, but down 1% from June 2022. Corn is also monitoring second crop harvest activity in Brazil. The USDA’s attaché in Argentina sees 2023/24 production at 55 million tons, compared to the official guess of 54 million and the drought ravaged 2022/23 total of 34 million tons. Exports in the coming marketing year are expected to benefit from a bigger crop, seen at 42 million tons, compared to 22 million for the current marketing year.

The wheat complex was mostly lower. Chicago and Kansas City were pressured by slow export demand and late winter wheat harvest pressure. Minneapolis was mixed, keeping an eye on forecasts for spring wheat growing areas in the U.S. and Canada. The northern U.S. Plains should see at least some rain this week, but the Canadian Prairies could remain drier than normal. A big question mark for the complex continues to be the impact of the ongoing war between Russia and Ukraine on export trade. The USDA says the second quarter wheat for flour grind was 221.951 million bushels, 2% lower than the first quarter of 2023 and 4% less than Q2 2022. The USDA’s attaché in Argentina projects 2023/24 wheat production at 17 million tons, compared to the official estimate of 17.5 million and the 2022/23 total of 12 million tons. Exports next marketing year are seen at 12 million tons, compared to 4.6 million this marketing year.

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