Market News

Renewed fund buying suppports soybeans, corn, wheat

Soybeans were higher on fund and technical buying. There was also spillover support from the renewed strength in crude oil on supply concerns. The USDA’s good to excellent rating held and harvest is starting to get underway, nationally. Yield results will be watched closely due to the tight stocks-to-usage ratio. Ahead of the open, CONAB confirmed record soybean production for Brazil at 180.407 million tons, while projecting soybean exports at an all-time high of 116.2 million tons. The USDA’s next round of supply and demand estimates is out October 9^th, while CONAB’s first look at new crop production in Brazil is slated for October 15^th. New crop planting in Brazil is in the very early stages. Soybean meal futures were supported by fund buying, while bean oil closed mixed on bull spreading. The NOPA member crush for August was lower than expected but record large for the month.

Corn was higher on fund and technical buying, in addition to the gains in crude oil. The U.S. corn harvest is ahead of average and the national crop rating improved by 1%. While the market has already baked in last week’s lower yield estimate, any signs of further cuts in the coming months could lead to more aggressive demand rationing. The U.S. Energy Information Administration’s weekly ethanol numbers are out Wednesday. CONAB’s combined corn crop guess was up 0.7% from last month at 144.01 million tons, which would be 2% above last year. First crop production is pegged at 29.488 million tons, with a second crop of 112.131 million tons and a third crop of 2.391 million tons. While a big chunk of that second crop will likely mean more export competition for the U.S., Brazil is also ramping up corn-based ethanol production. France’s AgriMer slashed its corn production projection by 900,000 tons to 8.1 million. Ukraine’s Ag Ministry says the to date corn harvest total is 168,000 tons.

The wheat complex was higher on fund and technical buying. Winter wheat planting is a little behind average, while the spring wheat harvest should wrap up soon. The USDA will release its Small Grains Summary on the 30^th, in addition to updated Quarterly Grain Stocks. Exports out of the Black Sea region continue to be heavily restricted by Russia’s war in Ukraine. There’s been talk of a limited truce this week, but that seems to have been disregarded by both Moscow and Kyiv. The trade is also monitoring crops in Argentina and Australia, along with the harvest in Canada. Statistics Canada will issue an updated production report Wednesday. France’s AgriMer estimates soft wheat production at 31.7 million tons, a decline of 200,000 from last month’s guess. Ukraine’s Ag Ministry says farmers have harvested 24.93 million tons of wheat.