Soybeans, corn see a little bit of profit taking
Soybeans were modestly lower on profit taking and technical selling. The USDA’s national good to excellent rating was down 1% on another mixed week of weather in many key U.S. growing areas. Forecasts for the early part of August are at least a little less threatening, but that will have to materialize and even six-to-ten-day forecasts can be unreliable. In any event, the USDA will probably lower its yield projection because of the widespread persistent drought conditions, maybe as soon as the next set of supply and demand numbers on August 11th. Soybean meal was up on commercial support, while bean oil was mixed on bull spreading. While the USDA did announce the sale of U.S. soybeans to China Monday, Brazil continues to dominate that market due to competitive pricing and a closer trade relationship between Brazil and China.
Corn was modestly lower on profit taking and technical selling. Near-term forecasts have high temperatures this week, but there is a better chance for rain in some areas next week. The good to excellent rating for corn held, even with big soil moisture deficits in parts of the region. Another downward adjustment for production is likely because of the ongoing, widespread drought in the Corn Belt. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday. AgRural says 47% of Brazil’s second corn crop is harvested in the main central-south production region, compared to 62% a year ago. CONAB’s updated outlook for Brazil’s crops is scheduled for August 10th. Argentina’s government is trying to push corn exports with the Ag Ministry issuing a resolution similar to Buenos Aires’ soy dollar pricing scheme.
The wheat complex was mixed, consolidating after the big gains on Monday. The trade is waiting for new developments in the war between Russia and Ukraine. Russia continues to control the global wheat market because of price and while there are likely to be some disruptions to trade because of stepped up attacks on Ukrainian infrastructure, the full scope might not be evident for a few weeks. The European Union has reportedly met to explore options to aid Ukraine’s exports. The U.S. winter wheat harvest is slower than average and the spring wheat rating dipped. Spring wheat growing areas of the northern U.S. Plains and Canada could see some relief, but it’s going to take a lot of rain to make up for the recent weather pattern in most of the region.