Market News

Soybeans down, corn up, preparing for quarterly stocks

Soybeans were modestly lower on profit taking and technical selling. The trade is expecting generally good harvest progress over the next week and is watching yield results. There was also position squaring ahead of Friday’s Quarterly Grain Stocks report, with most analysts expecting a year-to-year decline in domestic supplies. The average guess is 242 million bushels, compared to 274 million this time last year. The report is out at Noon Eastern/11 Central. This could be the last major piece of U.S. governmental crop data for a while as a federal shutdown would more than likely lead to a delay of the October 12^th supply, demand, and production report. Weekly U.S. soybean export sales were above a week ago, but unspectacular as Brazil continues to hold sway over the global market. China did pick up most of the weekly total, followed, distantly, by Mexico, but there was a significant cancellation by unknown destinations. Soybean meal was higher and bean oil was lower, unwinding some product spreads put in place earlier in the week. The first notice day for October soybean product contracts is Friday and the new marketing year starts October 1^st.

Corn was modestly higher on short covering and technical buying. Weather generally looks good for corn harvest activity over the next week, with only scattered showers in most near-term forecasts. Anecdotal yields remain mixed, but maybe a little bit better than what some were expecting ahead of widespread activity. Ahead of Friday’s Quarterly Grain Stocks report, there’s a wide range of estimates for corn, with an average of 1.429 billion bushels, compared to 1.377 billion on September 1^st, 2022. Ethanol demand continues to be solid, canceling out some of the bearish export influence. Weekly U.S. sales were up, Mexico and unknown destinations led the way. It’s early in the marketing year, but the 2023/24 pace is slower than 2022/23. Corn is also watching planting weather in Argentina and Brazil, with persistent dry conditions in some areas. Still, parts of central Brazil are starting to see a wetter pattern, which will help.

The wheat complex was mixed with Chicago and Kansas City down on follow through selling and Minneapolis mostly lower on bear spreading. The global fundamental outlook remains bearish with an ample supply and Russia dominating the export market, for now. Some origins are now lower priced than Russia, with Egypt buying 120,000 tons from Romania and 60,000 tons from Bulgaria, citing prices. There’s also some unconfirmed chatter about China buying wheat from France. Ukraine is shipping grains along alternative routes, albeit at lower levels than before the end of the Black Sea Grain Initiative. U.S. sales were up sharply from last week, with the Philippines and South Korea topping the list. While shipments were a marketing year high, the 2023/24 pace remains behind 2022/23. The trade is expecting good U.S. winter wheat planting progress over the next few days. The USDA’s Small Grains Summary is out Friday, with analysts estimating all wheat production at 1.729 billion bushels, with a winter wheat crop of 1.227 billion and a spring wheat crop of 446 million bushels, all of which would be below the August projections. Quarterly wheat stocks are seen at 1.772 billion bushels, compared to 1.778 billion a year ago.