Wheat, corn gain as soybeans droop
September 14, 2021 By John Perkins Filed Under: Closing Futures / Livestock Briefs, Crops Markets, Market News
Soybeans were modestly lower on fund and technical selling, unable to see follow through buying from periodic support. It was a choppy day for beans, with the USDA’s condition rating holding steady and development ahead of average. Early harvest delays are expected in some southern areas due to Tropical Storm Nicholas. The USDA’s first national harvest update of the season is expected in next week’s crop progress and condition report on Monday the 20th. The NOPA’s member crush numbers for August are out this Wednesday, with the average guess at 154.183 million tons, which would be down on the month and the year due to tight supplies and high prices. Soybean meal was higher and bean oil was lower, adjusting product spreads. Bean oil had additional support from a lower canola production guess for Canada. Statistics Canada estimates Canada’s 2021 canola production at 12.782 million tons, a drop of 34.4% on the year due to drought in western Canada and potentially the smallest crop since 2010, with yield seen at a ten-year low of 25.3 bushels per acre, a decline of 39.5% from 2020. Canada’s soybean crop is pegged at 5.886 million tons, 7.4% less than last year. There were no announced sales of U.S. soybeans Tuesday morning, but demand has been solid so far this month, especially from China.Corn was higher on fund and technical buying. The USDA’s corn condition rating dipped 1% and 4% of the crop is harvested, compared to 5% on average. Corn will need a trend line yield or better to meet demand expectations and limit further price inflation for end users. The USDA did raise its 2021 crop guess last week to nearly 15 billion bushels. Efforts are continuing to bring all grain terminals in southern Louisiana back online following damage from Hurricane Ida. Export demand for U.S. corn, already slow, has been slowed down further by that damage. First crop planting is ongoing in Brazil at 16.7%, with rain in the south and dry weather in central areas ahead of the widespread rainy season. 70% of the old second crop has been sold. Analysts are projecting an increase in planted area this year after the previous growing season’s smaller than expected crops. Argentina will also likely plant more corn this year to meet demand. Statistics Canada estimates this year’s Canadian corn for grain crop at 14.368 million tons, up 5.9%, thanks to better weather in eastern and central growing areas. National yield is expected to be 7.8% higher at 165.4 bushels per acre, cancelling out a decline in harvested area. Ethanol futures were unchanged. The U.S. Energy Information Administration’s weekly ethanol production and supply numbers are out Wednesday.The wheat complex was higher on fund and technical buying. Statistics Canada slashed production estimates and France also lowered its crop outlook. For Canada, non-durum spring wheat production is projected at 15.321 million tons, a decrease of 40.7% from 2020 due to drought in western Canada, which has also impacted U.S. spring wheat production in the northern and northwestern U.S. Plains. All wheat production for Canada is expected to be 21.715 million tons, a decline of 38.3%, with an average yield of 35.2 bushels per acre, a drop of 32.6% and lower harvested area. France’s Ag Ministry has soft wheat production at 36.06 million tons, 700,000 tons under the prior guess. The trade is also watching harvest activity in the rest of Europe, Russia, and Ukraine, along with development conditions in Argentina and Australia. 12% of the U.S. winter wheat crop is planted, faster than average. The USDA’s U.S. small grains summary is out September 30th, along with quarterly grain stocks.
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