Market News

Soybeans, corn see broader market pressure

Soybeans were lower on profit taking and technical selling, along with higher trade in the dollar and a lower move in crude oil. China appears to be continuing its zero-COVID policy, contrary to earlier reports, which would impact demand. There’s some weekend rain in the forecast for South America ahead of a drier pattern. U.S. harvest activity is ongoing with some areas likely to wrap up in the next few says. The USDA’s next set of supply, demand, and production numbers is out November 9^th, the same day as CONAB’s updated outlook for Brazil. U.S. soybean export sales were down on the week, back under a million tons, primarily to China and Spain, with a cancellation by unknown destinations. Soybean meal futures were lower on commercial selling and soybean oil was mixed on bear spreading, with nearby contracts backing off after hitting established highs for the move. Crush margins remain bullish.

Corn was lower on fund and technical selling. The macroeconomic picture is seen as bearish following the interest rate hike, with some pressure from the outside markets during Thursday’s session. The trade is watching weather in South America and U.S. harvest activity. Domestic ethanol and feed demand continue to be supportive factors, even as exports remain disappointing due to the relatively high U.S. price. Weekly corn exports sales improved, but remain slower than expected, with Mexico and Japan topping the list. The Renewable Fuels Association says September ethanol exports were 100.4 million gallons, up 30% from August, mainly to Canada, the Netherlands, and South Korea. DDGS exports were 877,745 tons, a five-month low and down 11% on the month.

The wheat complex was mostly lower, consolidating after Wednesday’s big drop. The situation in the Black Sea region remains fluid, with Russia continuing to attack infrastructure in Ukraine, even while staying in the export corridor agreement, for now. Moscow has been signaling it is unlikely to agree to an extension of the Black Sea export corridor deal unless there are some huge concessions by Ukraine and the U.N. In other words, it doesn’t look like the fluid Black Sea situation will firm up any time soon. The trade is monitoring U.S. winter wheat planting and development weather, along with drought impact concerns in Argentina and issues with excessive rain lowering quality in Australia. Argentina’s Ag Secretariat is reportedly allowing exporters to delay shipments by up to 360 days to bolster domestic supplies in the face of dwindling crop prospects. Weekly U.S. wheat export sales fell below 350,000 tons, primarily to South Korea and Indonesia.