Market News

Wheat, soybeans, corn up on Black Sea uncertainties

Soybeans were higher on commercial and technical buying, ending an up and down day solidly in positive territory. Beans followed bean oil, which was up on a probable slowdown in sunflower oil exports from Ukraine. Harvest weather in the U.S. and planting conditions in Brazil generally look good. Stateside, the USDA says 88% of U.S. soybeans are harvested, compared to the five-year average of 88%. In South America, midday forecasts were generally a little bit drier, which will likely have more of an impact on Argentina than Brazil. Highways in at least three Brazilian states have been reportedly blocked by trucks contesting the results of that nation’s presidential election Sunday. U.S. soybean export inspections last week topped 2.5 million tons, below last week and last year, primarily to China and Mexico. Soybean meal was up on a late bounce tied to the strength in the soy complex.

Corn was higher on commercial and technical buying but failed to break overhead technical resistance. Corn is watching the Black Sea region, expecting Russia’s pull out from the Ukraine grain export deal to boost U.S. sales. Mississippi River levels remain low, even after recent rain in the Midwest. As of Sunday, 76% of U.S. corn is harvested, compared to 64% on average. Corn export inspections were down from the previous week and a year ago, partially due to interior movement issues caused by low river levels, with China and Mexico topping the list. The USDA’s next round of supply, demand, and production levels is out Wednesday, November 9^th, the same day as CONAB’s updated outlook for Brazil. Planting is reportedly going well in Brazil, but the big test will be the second crop, the source of most of that nation’s exports, which is planted after soybeans are harvested. The trade is also monitoring planting in Argentina, with dry weather likely impacting acreage.

The wheat complex was sharply higher on commercial and technical buying. Russia’s exit from the Ukraine grain deal over the weekend was the big driving factor for wheat. This developing situation will likely tighten global supplies and could help U.S. wheat export sales. Export inspections were up modestly on the week and the year, still ahead of the pace needed, mainly to Somalia and Mexico. There is still a lot up in the air right now, with Moscow continuing to attack Ukraine while claiming a Ukrainian drone attack came from a civilian vessel, which has not been verified. Until this week, negotiations to extend the Black Sea export corridor were ongoing, also involving the U.N. and Turkey. France is reportedly working to find a land route for Ukraine’s grain exports if the Black Sea route collapses, as expected. SovEcon estimates Russia’s October grain exports at 4.85 million tons, which would be up from both the initial guess and the September total. The USDA says 87% of U.S. winter wheat is planted, compared to 85% on average, with 62% emerged, compared to the normal rate of 66%, and just 28% of the crop rated good to excellent, compared to 45% in last year’s first rating.