Market News

Soybeans see a slight bounce

Soybeans were modestly higher on short covering and technical buying. Contracts are oversold and the U.S. harvest remains slower than normal at 96% complete as of Sunday, with more delays probable in northern areas, even if drier forecasts hold for the rest of the Midwest and Plains. Gains were limited by good crop weather in Brazil, most analysts project a record crop, along with the uncertainties about phase one of the proposed trade deal with China. President Trump Tuesday said a trade deal between the U.S. and China might not be finalized until after the 2020 Presidential election and new tariff threats for Argentina, Brazil, and France also had the broader market on edge. For now, at least, China is still buying U.S. soybeans, with new tariffs scheduled to go into effect December 15th. Soybean meal was mixed, adjusting old crop/new crop spreads, and bean oil was up, following beans.

Corn was mixed, mostly modestly higher, with nearby contracts weak and deferred months firm. About 1.5 billion bushels of corn is still unharvested and some of it might not be harvested until spring, especially the areas hardest hit by the past weekend’s winter-like storm. The USDA is surveying producers for the January crop production totals, but that likely won’t be the absolute final word on the 2019 crop. Corn is also watching weather in South America, including drier conditions in parts of Argentina. Still, temperatures in Argentina are expected to remain moderate, limiting stress, and Brazil is projected to produce a large second crop. Argentina and Brazil, along with Ukraine, have been big competitors in the export market over the last several months. Ukraine’s Ag Ministry says corn exports this marketing year are 7.5 million tons. Ethanol futures were steady to lower. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday.

The wheat complex was mixed, with Chicago and Kansas City down on efforts to make prices more competitive and Minneapolis up on good demand for higher protein wheat and spread adjustments. Export demand for U.S. wheat is slowing down, but halfway through 2019/20, sales and inspections are still ahead of last marketing year. Australia’s government has lowered its crop guess, yields in parts of Argentina have been poor, and planted area in portions of the European Union has been limited wet weather. Russia’s Ag Ministry lowered its wheat production estimate, but the crop is still expected to be relatively large, allowing for plenty of export potential. Ukraine’s Ag Ministry says wheat exports are 13.5 million tons, compared to 9.4 million this time last year. The USDA’s next set of supply, demand, and production estimates is out Tuesday, December 10th at Noon Eastern/11 Central. DTN says Japan is tendering for 160,640 tons of food wheat from the U.S. and/or Canada, while Algeria, Egypt, Ethiopia, and Jordan also have open wheat tenders.

  • Are soybeans and corn sales down because of Trump and the tariffs?

    • Soybean sales yes, the decline in corn is more due to competition from South America and Ukraine. China is able to produce enough corn domestically to meet their own needs, only expected to import 7 million tons this marketing year.

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