Market News

Soybeans down, waiting for what’s next with China

Soybeans were lower on profit taking and technical selling. Beans are waiting for China to sign phase one of the trade deal and for phase two to get underway, which will probably take some time. The trade is also waiting for those rumored Chinese purchases to start surfacing. Unknown destinations bought 142,579 tons of 2019/20 U.S. beans. That sale might go to China, but it also might not. Weekly export inspections were above what’s needed to meet USDA projections for the marketing year. The USDA says 85% of U.S. soybeans are dropping leaves, compared to the five-year average of 93%, with 26% of the crop harvested, compared to 49% on average. 54% of the crop is in good to excellent shape, up 1% on the week. AgRural says 11% of Brazil’s soybean crop is planted and while rain is headed for some dry areas, Brazil’s FOB prices have hit new highs for the year. The trade is also watching planting weather in Argentina. The National Oilseed Processors Association’s member crush for September was reportedly smaller than expected. Soybean meal was lower and bean oil was higher on the adjustment of product spreads.

Corn was lower on fund and technical selling. Corn is also waiting for what’s next with China, while watching U.S. crop conditions. The storm this past weekend did damage crops and further delay harvest activity in some key growing areas. As of Sunday, 96% of U.S. corn has dented, that stage is usually complete by now, while 73% of the crop is mature, compared to 92% normally this time of year, and 22% is harvested, compared to 36% on average. 55% of corn is in good to excellent condition, down 1% from a week ago. Ethanol futures were lower. The EPA released a supplemental proposal for renewable fuel volumes, which did not account for volume lost to small refinery exemption waivers, drawing fire from some in the industry and commodity groups. The proposal is now subject to a public hearing and comment period. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Thursday. Weekly export inspections were bearish, reflecting the competition from Argentina, Brazil, and Ukraine.

The wheat complex was lower on fund and technical selling. Most forecasts have improved winter wheat planting weather, but the spring harvest should stay slow after that snowfall in the northern U.S. Plains and Canada. For winter wheat, 65% of the crop is planted, matching the typical pace, and 41% has emerged, compared to 40% on average. For spring wheat, 94% of this year’s crop is harvested, compared to 100% usually in mid-October. Weekly export inspections were bearish, continuing to slow down as the world harvest advances, but 2019/20 is still ahead of the 2018/19 pace. DTN says Turkey is tendering for 190,000 tons of milling wheat and 125,000 tons of durum, with the durum tender for the European Union. The USDA’s weekly export sales report is out Friday morning. APK-Inform has Ukraine’s wheat crop at 27.9 million tons with exports of 18.6 million, both up from previous projections. Russia’s Ag Ministry says harvest activity is ahead of a year ago with better yield results.