Market News

Down day for soybeans, corn despite heat

Soybeans were lower on profit taking and technical selling. The USDA’s good to excellent rating held this week, but probably won’t hold next week. Forecasts for this week remain hot and the region could remain generally dry into early next month. Given just how tight ending stocks projections are for the new marketing year, any loss of yield would probably prompt higher prices and demand rationing. The USDA’s next set of supply, demand, and production numbers are out September 12^th and will include an acreage resurvey for some states. The new marketing year for soybeans, and corn, gets underway September 1^st. Soybean meal and oil futures followed corn lower. Dry weather is a concern for parts of South America ahead of widespread planting, which usually starts in September.

Corn was modestly lower on fund and technical selling. Corn is watching the weather and while it’s a bigger issue for beans in terms of development, it could have an impact on corn test weights, in addition to speeding up maturity. A major crop tour is showing better than a year ago yields in parts of the Eastern Corn Belt, but overall, numbers have a wide range so far. Exports remain slow, but ethanol margins are positive. The U.S. Energy Information’s weekly ethanol and production report is out Wednesday. The European Union’s crop group MARS reduced its yield outlook for the bloc’s corn crop, but production should still be above last year’s drought impacted production. Corn is also watching second crop harvest activity in Brazil, along with conditions ahead of the next round of corn planting. The USDA says Mexico bought 224,000 tons of U.S. corn Tuesday morning, with half for 2024/25 delivery and half for 2025/26.

The wheat complex was mixed, with Chicago up, Kansas City steady to weak, and Minneapolis lower. Ukraine is exploring alternative routes in and out of the Black Sea to move grain and while there has been some early success, Russia could act at any time. Russia’s war on Ukraine is ongoing, with no apparent end to the conflict in sight. Despite Moscow’s aggression, Russia continues to hold a big chunk of the global wheat market. U.S. soft red winter is becoming more competitive, which could boost U.S. exports, and Romania’s prices are also competitive against Russia. The trade is also watching the tail end of the U.S. winter wheat harvest and the slow advance of the U.S. spring wheat harvest. Dry weather is an issue in parts of Canada, Argentina, and Australia, while wet weather is impacting harvest in portions of the European Union. The E.U.’s crop group MARS lowered its soft wheat average yield guess, citing that wet weather. Statistics Canada will issue updated production projections for Canada Thursday.