Market News

Soybeans, corn down ahead of widespread harvest

Soybeans were modestly lower on fund and technical selling. It was an up and down day for beans, eventually bowing to early harvest pressure and a lower move in crude oil. There was little reaction in the commodity markets to the tentative agreement averting a U.S. railroad strike. The delayed export numbers were good, with the sales pace ahead of last marketing year. China and unknown destinations were the biggest buyers last week. The 2021/22 total was down 6% from 2020/21. The USDA’s next set of supply, demand, and production numbers is out October 12^th. Soybean meal was higher and bean oil was lower on the adjustment of product spreads. The NOPA says member firms crushed 165.538 million bushels of soybeans in August, less than what analysts were expecting heading into the report.

Corn was modestly lower on fund and technical selling. Corn is waiting to see if that railroad strike is completely off the table, while watching early harvest activity, with many expecting solid progress in the next update on Monday the 19^th. Export sales remain slow due to competition from Ukraine and Brazil. Last week’s sales were good, but not outstanding, mainly to Mexico and Guatemala, with no reported demand from China. The 2021/22 sales total for corn was 11% below 2020/21. Strategie Grains estimates 2022 European Union corn production at 52.9 million tons, which would be a drop of 24.4% on the year due to drought in some key growing areas.

The wheat complex was lower on fund and technical selling. Wheat export demand is bearish, even with tighter domestic and global supplies. The big buyers for U.S. wheat last week were Iraq and Mexico, but there was a significant cancellation by unknown destinations. Russia and Turkey along with several other nations are scheduled to meet Friday to discuss the Black Sea export corridor for Ukraine. The agreement allowing that corridor expires November 22^nd, with Russia unlikely to endorse an extension as Ukraine retakes territory. There is some rain in the forecast for the southern Plains, but conditions are expected to remain mostly hot and dry during planting. Planting conditions are generally better for soft red winter growing areas in the eastern Midwest. U.S. spring wheat harvest activity is nearly over for the year. Strategie Grains pegs 2022 European Union soft wheat production at 124.1 million tons, up slightly from August, but down 4.4% from 2021.