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Soybeans, corn down on bearish USDA numbers

Soybeans were sharply lower on fund and technical selling, with November falling below $12 a bushel. The USDA raised production, yield, and new crop ending stocks, all larger than expected and above a year ago. As of Sunday, 49% of U.S. beans are harvested, compared to the five-year average of 40%, and 91% are dropping leaves, compared to 89% on average, with 59% of the crop in good to excellent shape, up 1% on the week. Near-term harvest delays are probable in some areas. Argentina’s crop guess was down a little on the month at 51 million tons due to lower planted area, while Brazil was unchanged at a record 144 million tons. No changes were made to exports. Planting conditions in Brazil continue to generally look better than in Argentina. Export inspections were up sharply on the week, but down sharply on the year, mainly to China and Taiwan. Soybean meal and oil were lower on the fundamental implications of higher production. Oil had additional pressure from a lower move in palm oil ahead of the U.S. session due to bearish October exports for Malaysia.

Corn was lower on fund and technical selling, closing right around the session lows. Corn production and yield were up on the month when most were expecting a decline, and ending stocks were above analysts’ estimates. 41% of the corn crop is harvested, compared to the usual rate of 31%, with 94% of the crop mature, compared to 86% on average, and 60% rated good to excellent, 1% higher. Parts of the region are expected to see harvest delays through the end of the week. The USDA left South American production estimates steady. China did lower its corn production estimate to 271 million tons, but the USDA kept its guess at 273 million and left imports at 26 million tons. Export projections for Russia and Ukraine were down modestly. The next set of supply, demand, and production projections is out November 9th. Export inspections were below the previous week and last year with Mexico and Colombia topping the list. Mexico bought 165,000 tons of 2021/22 U.S. corn. Argentina is reportedly prioritizing the marketing of already harvested corn over the new crop. Ethanol futures were unchanged. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Thursday.

The wheat complex was modestly higher on fund and technical buying. U.S. wheat ending stocks were a little bit below expectations due to a smaller crop and lower import estimate. Global old and new crop ending stocks were down on the month. The biggest new crop world adjustments were a slight decrease for Canada against a slight increase for the European Union. The USDA did bump up exports for Australia and the E.U., while cutting the outlook for Canada. 60% of U.S. winter wheat is planted, matching the five-year average, while 31% has emerged, compared to 35% typically in mid-October. Precipitation in the southern Plains is expected to be long-term beneficial for hard red winter, but large portions of the white winter region remain dry. Wheat inspections remain behind the year ago pace, with last week’s top leading destinations Japan and Colombia. DTN says Japan is tendering for 119,512 tons of food wheat from the U.S., Australia, and/or Canada, while Egypt is in the market for 55,000 to 60,000 tons of wheat.

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