Market News

Soybeans, corn up ahead of quarterly numbers

Soybeans were modestly higher on short covering and technical buying. Beans continued to bounce off Monday’s lows, watching U.S. harvest activity and yield results. Anecdotal numbers have been a little bit better than expected in some areas. Quarterly stocks in Friday’s report are expected to be below a year ago. If the federal government is unable to prevent a shutdown, that might be the last major set of USDA numbers out for quite some time, including a potential delay for the next set of yield and production estimates currently scheduled for October 12^th. Soybean meal was lower and bean oil was higher on the adjustment of product spreads. The trade is also monitoring planting in South America.

Corn was higher on short covering and technical buying. Harvest conditions look favorable, aside from scattered showers in the Eastern Corn Belt. Ethanol margins are strong with production up on the week. The U.S. Energy Information Administration says production averaged 1.009 million barrels a day, an increase of 29,000 on the week and 154,000 on the year, while stocks were reported at 22.048 million barrels, 367,000 above the previous week, but 643,000 below a year ago. Ethanol exports were down from the week before. That’s canceling out some of the influence of slow exports, with the USDA’s weekly sales numbers out Thursday morning. Brazil is holding a lot of the global market and Ukraine has reportedly recently shipped corn to China.

The wheat complex was lower on fund and technical selling. Contracts essentially took the path of least resistance, with pressure from the firm dollar and mostly lower global prices. The complex is monitoring U.S. winter wheat planting activity, along with crop weather in Argentina and Australia. Even with the slow export demand, projected at multi-decade lows, quarterly wheat stocks should be their lowest in several years following declining U.S. production. The USDA’s Small Grains Summary report is also out Friday. Russia continues to control the export market, while Ukraine is finding some success moving grains along alternative routes despite continued attacks. Egypt is reportedly negotiating to buy 1 million tons of wheat from Russia.