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Soybeans, corn down on last day of marketing year
Soybeans were lower on fund and technical selling. The trade continues to watch yield projections, with August rainfall in parts of the Midwest and Plains stabilizing conditions. Allendale Inc.’s annual producer survey projects this year’s crop at 4.435 billion bushels with an average yield of 50.86 bushels per acre. Those are both below the USDA’s August number, but, if realized, the production total would tie with 2021’s record crop. China bought 167,000 tons of new crop U.S. beans, following up on Tuesday’s purchase by unknown, for a two-day total of 431,000 tons, all new crop. Demand has picked up over the last couple of weeks as Brazil’s supplies tighten along seasonal lines. The USDA’s weekly export sales report will not be issued again until September 14th, delayed by the issues encountered last week during the switch over to the new system. July’s U.S. soybean crush is seen at 180.5 million bushels, which would be up on the month and the year, with the report out Thursday afternoon. Soybean meal was lower and bean oil was higher, adjusting product spreads. Argentina’s Ministry of Agriculture says producers have sold 51.6% of the 2021/22 soybean crop, compared to 62% this time last year.
Corn was lower on fund and technical selling. Corn gave back some gains after December hit a two-month high Monday, preparing for the end of the month, quarter, and marketing year. Most traders expect the USDA to reduce the yield guess on September 12th, the question is by how much. Allendale Inc.’s producer survey pegs the crop at 14.108 billion bushels with an average yield of 172.39 bushels per acre, under the USDA’s August estimates. Export demand for U.S. corn has been relatively slow recently, with increased competition from Brazil and Ukraine. Argentina’s Ag Ministry says 64% of the 2021/22 corn crop has been sold, in-line with recent years. New crop planting in parts of South America gets underway next month. The trade is waiting to see what kind of impact La Nina conditions will have on South American crops. The U.S. Energy Information Administration says ethanol production last week averaged 970,000 barrels a day, down 17,000 on the week, but up 65,000 on the year, with stocks of 23.533 million barrels, a decrease of 274,000 from the previous week, but an increase of 2.423 million from a year ago. The USDA’s July corn for ethanol use numbers are out Thursday.
The wheat complex was higher on short covering and technical buying. The dollar was down for most of the session, helping wheat rally from the early losses, but remains near the highs for the year, pricing U.S. wheat above other origins. That’s severely limited export competition when many analysts were expecting at least some uptick in business due to weather issues in India and the European Union, in addition to the swirling storm of uncertainties connected to Ukraine. However, taking China out of the equation, global supplies are very tight. While there’s been no direct interference in Ukraine’s Black Sea exports, Russia’s attacks on Ukraine continue, with shelling hitting the second largest port of Mykolaiv, damaging storage. Storage has been a concern for Ukraine as have harvest activity and new crop planting. SovEcon sees Russia’s 2022/23 wheat exports at 43.1 million tons with production of 94.7 million. The Rosario Grain Exchange estimates Argentina’s 2022/23 wheat crop at 17.7 million tons, with harvest set to start in November.
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