Market News

Soybeans, corn down on harvest pressure

Soybeans were modestly lower on fund and technical selling. The USDA says this year’s harvest is 20% complete, compared to 15% on average, and aside from some rain, good conditions expected in many areas over the next several days, which is expected to allow progress to hit the halfway mark soon. There is limited potential for freeze damage in northern areas. Mexico bought 100,000 tons of 2020/21 U.S. beans. Starting October 1^st, demand from China is expected to slow because of the weeklong Mid-Autumn Festival. The USDA’s quarterly grain stocks report out Wednesday will give a preview of the 2019/20 ending stocks total, with the supply expected to be lower than a year ago. Soybean meal was mixed, nearby contracts down, deferred months up, on commercial spread adjustments, while bean oil was lower, following beans and crude oil. According to date from the European Union, marketing year to date soybean imports are 3.36 million tons, up 1% from the previous marketing year.

Corn was modestly lower on fund and technical selling. 15% of corn is harvested, up on the week, but a little bit slower than normal, with some producers concentrating on beans. Recent solid export demand did limit losses, especially the demand from China, but typhoon damage to their domestic crop might not have been as bad as initially feared. Still, U.S. prices are competitive and China needs to meet Phase One agreement purchase obligations. The USDA’s quarterly grain stocks numbers out Thursday is expected to show good third quarter usage, but also reflect a larger than last year supply. The trade is also watching planting conditions in Argentina and Brazil, which generally look dry. The U.S. Energy Information Administration’s weekly ethanol production and supply numbers are out Wednesday. Ethanol futures were mostly lower.

The wheat complex was modestly lower on fund and technical selling. 35% of U.S. winter wheat is planted and 10% has emerged, both slightly faster than average, while the spring wheat harvest has officially wrapped up. There are concerns about winter wheat acreage in the U.S. Plains being limited by dry weather in the region. The trade is also watching dry conditions in Argentina, Australia, Russia, and Ukraine. The USDA’s quarterly grain stocks report out Wednesday is expected to have the September 1^st supply up on the year, first quarter 2020/21 demand will be watched closely, while the average estimate for the updated all wheat production projection is 1.835 billion bushels, compared to the last guess of 1.838 billion and the 2019/20 total of 1.962 billion bushels. The numbers are out at Noon Eastern/11 Central. The USDA’s next set of supply and demand estimates is out October 9^th. DTN says Jordan bought 120,000 tons of milling wheat from an “unknown origin” and Thailand is tendering for 213,000 tons of optional origin feed wheat.