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Soybeans continue to follow lead of meal

Soybeans were higher on commercial and technical buying. Beans followed meal, which was supported by talk of tight supplies in Argentina, the world’s biggest soybean product exporter. The USDA says 92% of U.S. soybeans are harvested, compared to 87% a week ago and the five-year average of 93%. Unknown destinations bought 264,000 tons of 2021/22 U.S. beans Monday morning, following up on Friday’s purchase of more than 250,000 tons. Export inspections were below the previous week and year’s big totals, but still topped 2 million tons. The leading destinations were China and Mexico. The NOPA says member firms crushed 183.993 million bushels during October, the highest this year since January, but modestly below a year ago. Soybean oil stocks were up sharply on the year, which pressured bean oil, along with the unwinding of product spreads. South American conditions generally look good, aside from dry conditions in parts of southern Brazil.

Corn was mixed, adjusting old crop/new crop spreads. Corn is watching U.S. harvest activity and conditions in Argentina and Brazil. Stateside, 91% of U.S. corn is planted, compared to 84% last week and 86% on average. In South America, near-term conditions generally look favorable, but some key growing areas will need rain and the impending La Nina pattern is a wild card. Mexico bought 198,200 tons of U.S. corn, with 148,200 for 2021/22 delivery and 50,000 tons for 2022/23. Export inspections were up on the week, down on the year, with the 2021/22 pace behind 2020/21. The main destinations were Mexico and Colombia. Demand from China continues to be much slower than expected, with Beijing reportedly sourcing corn from Ukraine last week, despite the U.S. price advantage. Ethanol futures were unchanged.

The wheat complex was mixed. Chicago and Kansas City were up, monitoring winter wheat planting and emergence conditions, while Minneapolis was down on overbought signals. For winter wheat, 94% of the crop is planted, matching the usual rate, and 81% has emerged, compared to 83% normally in mid-November, with 46% of winter wheat in good to excellent shape, up 1% on the week. The trade is also watching pre-harvest conditions in Argentina and Australia, with Australia expected to see a beneficial drier pattern, in addition to weather ahead of dormancy in Europe, Russia, and Ukraine. Russia’s wheat export tax shot higher again this week, now topping $77 per ton. That hasn’t led to an appreciable uptick in demand for U.S. wheat, which actually has been slower than expected. Closing in on the halfway point of 2021/22, export inspections were up on the week and the year but continue to trail the 2020/21 pace. The top destinations last week were Nigeria and Ethiopia.

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