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Soybeans, corn supported by yield concerns

Soybeans were higher on fund and technical buying. Forecasts have generally dry conditions in most of the region, along with a return to hot temperatures starting later this week. That’s expected to further impact yield during these key stages of development. The USDA says 58% of the crop is in good to excellent shape, 1% less than last week, with 91% of the crop at the pod setting stage and 5% dropping leaves, both near normal. Soybean export inspections were up on the week, down on the year, and in line with what’s need to meet projections for the current marketing year, which ends Thursday. The primary destinations were China and Mexico. Monday morning, unknown destinations bought 296,000 tons of 2023/24 U.S. beans. The Rosario Board of Trade says about 70% of Argentina’s crush capacity will be idle by December and will remain idle until the new crop is harvested early next year. Argentina has had to increase exports of soybeans to meet previously contracted product sales following a severely drought limited 2023 crop. Soybean meal and oil followed beans higher.

Corn was higher on fund and technical buying. Corn is watching the weather and what looks like a poor finish to what has been a fairly stressful season in some key growing areas. As of Sunday, 56% of U.S. corn is good to excellent, 2% lower, with 88% at the dough making stage, 51% dented, and 9% mature, all a little bit ahead of the respective five-year averages. The USDA could lower yield for corn, and soybeans, in the next supply and demand report on September 12th. Corn export inspections topped what’s needed to meet projections for the current marketing year, but that’s only after the USDA downgraded expectations in previous WASDE updates. Last week’s main destinations were Mexico and Colombia. Mexico did buy 123,000 tons of 2023/24 U.S. corn Monday morning. AgRural says 83% of Brazil’s second corn crop has been harvested. The next update from Brazil’s government is scheduled for September 6th.

The wheat complex was lower on fund and technical selling. The big bearish factor continues to be slow export demand for U.S. wheat, with Russia controlling the market. Soft red winter, traded in Chicago, is becoming more competitive though, which could spark some demand. Still, nearly a quarter into the 2023/24 marketing year, inspections trail the 2022/23 pace, with the weekly total higher than the prior week, but below last year. The top destinations were the Philippines and Japan. The U.S. spring wheat harvest is advancing while the winter wheat harvest is effectively done for the season. For spring wheat, 37% of the crop is called good to excellent, a decline of 1%, and 54% is harvested, compared to 63% on average. A second vessel from Ukraine has reportedly made it out of the Black Sea along one of the alternative shipping routes. While early estimates for Ukraine’s 2024 winter wheat crop are about steady on average, some farmers say they intend to reduce planted area in response to the difficulties growing and exporting grain caused by Russia’s war. Concerns about dry conditions in Argentina and Australia are still on the back burner, but starting to come to the fore as the growing season in the Northern Hemisphere draws to the close.

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