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Soybeans drop, corn and wheat also move lower

Soybeans were sharply lower on profit taking and technical selling. Export sales were up on the week, but lower than expected, and soybean oil is down sharply ahead of the monthly crush numbers. The October crush of 197 million bushels was up 29 million from September and unchanged from October 2021, with tighter soybean product supplies. Additional pressure from beans and bean oil can also be tied to the revised RVO numbers that were out Thursday. Weekly soybean sales were less than 700,000 tons, mainly to China, but with a significant cancellation by unknown destinations. There’s been talk but no confirmation that China has purchased soybeans from Argentina this week following the reintroduction of the “soy dollar” program by Buenos Aires. Crop conditions in South America continue to generally favor Brazil over Argentina.

Corn was lower on fund and technical selling. Corn export sales were below a week ago with the U.S. continuing to see a lot of competition, especially from Brazil and Ukraine. Weekly U.S. sales were barely over 600,000 tons, primarily to Mexico and unknown destinations. Mexico also bought 114,300 tons of 2022/23 U.S. corn Thursday morning, but sustained demand is a concern because of Mexico’s impending ban on GMO corn imports, set to begin in 2024. The USDA says 448.895 million bushels of corn were used for ethanol production in October, up 17% on the month, but down 4% on the year. Corn is also watching planting and development conditions in South America. CONAB’s updated outlook for Brazil is set for Thursday, December 8th, while the USDA’s new supply, demand, and production report is out Friday, December 9th.

The wheat complex was lower on fund and technical selling. Parts of the winter wheat region have recently received precipitation, while others remain locked in drought. U.S. and global supplies are tight, but export demand continues to be slow. Weekly sales were slightly more than 155,500 tons, just reflecting the extremely lackluster demand due in part to the relative strength in the dollar against the currencies of competing exporters. Those competitors include Russia and Ukraine. Shipping is ongoing out of the Black Sea region following the extension of the grain export agreement, but shipments from Ukraine have slowed down due to slower inspections of outgoing vessels by Russia. The trade is also monitoring drought impact on yield numbers from Argentina and the declining quality of Australia’s crop following heavy rainfall late in the season.

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