Market News

Wheat futures eke out modest gains

Soybeans were steady to fractionally lower, unable to hold onto periodic gains. China reportedly granting tariff waivers for 10 million tons of U.S. soybeans remains unconfirmed. Unknown destinations bought 128,000 tons of 2019/20 U.S. beans, which might be China, but might not be either. Negotiations are ongoing, with high-level, face-to-face talks scheduled to resume next month. Argentina and Brazil are both expected to see better rainfall in the coming weeks, helping planting gain momentum. The trade is also watching the slower than normal U.S. harvest pace. Soybean meal was higher and bean oil was lower, adjusting product spreads.

Corn was steady to fractionally lower. Parts of the Corn Belt will see rain over the next few days, but other areas are expected to make at least some harvest progress. It’s been a long year for a lot of producers in the Midwest and Plains, with an historically slow start to planting, a wide variance in development weather, and delays during the harvest. Slow export demand continues to be a big bearish factor, with the weekly numbers out Thursday morning. Corn is also watching planting and pre-planting conditions in South America. Ethanol futures were higher. China might also be interested in U.S. corn, ethanol, and DDGS. The U.S. Energy Information Administration says ethanol production last week averaged 996,000 barrels a day, up 25,000, while stocks dropped 697,000 barrels to 21.364 million. A court challenge to EPA policy on small refinery waivers is underway. The Renewable Fuels Association, Growth Energy, and U.S. Grains Council are reportedly disappointed Brazil amended its tariff rate quote for ethanol imports.

The wheat complex was higher on short covering and technical buying in light trade volume. At least some of the U.S. spring wheat crop won’t be harvested and most of what’s left is probably feed quality, but Canada is making progress in many areas. Recent rain should help winter wheat ahead of dormancy. The USDA’s next set of supply, demand, and production numbers is out November 8^th. There’s talk that China might be interested in buying U.S. wheat, but nothing has surfaced since that reported sale of 130,000 tons of 2019/20 white wheat a few weeks ago. DTN says Algeria bought 600,000 tons of wheat, “rumored” to be French origin, while Taiwan is tendering for 88,900 tons of U.S. milling wheat. Allendale says winter grain planting in Russia is ahead of a year ago thanks to warm and rainy weather, while planting in Ukraine is slightly slower than last year. The trade is also watching weather in Argentina and Australia.