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Wheat, corn rise, soybeans fall after USDA numbers

Soybeans were sharply lower on commercial and technical selling, cementing week-to-week losses. Soybean stocks at the start of September were up 7% on the year and near the high end of pre-report estimates. The USDA also made an upward revision to the 2021 production and yield numbers. Beans continue to monitor this year’s U.S. soybean harvest and planting conditions in Argentina and Brazil. Stateside, lower river levels are impacting interior movement. Export demand has also been a drag on beans recently, due to high U.S. prices, relative strength in the dollar, and the increase in sales by Argentina linked to the Buenos Aires “soy dollar” program. Soybean meal was lower and bean oil was down sharply on the losses in beans, with oil picking up additional pressure from a decline in crude oil. Palm oil was up Friday but lost a lot of ground during the week on demand uncertainties, impacting the entire global vegetable oil complex.

Corn was higher on commercial and technical buying, helping contracts to a firm weekly finish. Corn stocks on September 1st were 12% higher than a year ago, but that was below the average expectation thanks to better demand. The USDA lowered the 2021 production and yield numbers. The trade is monitoring the 2022 U.S. corn harvest, along with planting conditions in South America. Drought is delaying planting in portions of Argentina at just 5.8% complete, the slowest pace in a decade. Recent rain in parts of Brazil has helped, but the big test for corn in that country is the second crop, which is planted after soybeans are harvested. France’s corn harvest is 51% complete, with the crop much smaller than last year due to drought. The USDA’s next set of supply, demand, and production numbers is out October 12th.

The wheat complex was sharply higher on commercial and technical buying, ensuring a week-to-week gain. Quarterly stocks were close to pre-report expectations, while production was less than what analysts had been projecting and only up slightly from 2021. The trade is also watching developments in the Black Sea region. By Friday afternoon, Russia had made further indications it was annexing parts of Ukraine following a questionable vote on those areas while preparing another round of troops. While Ukraine has recently been able to push back Russian forces in some areas, Russia’s invasion, ongoing since February, has been strongly impacting Ukraine’s exports, harvest, and planting activities. There are a lot of concerns about drought impact on Argentina’s wheat crop. Argentina is a big exporter to other Mercosur bloc nations, especially Brazil.

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