Market News

Soybeans, corn down on lack of weather threat

Soybeans were lower on fund and technical selling. Trade negotiations with China have resumed but there are a lot of questions about just how much progress can be made. While there have been some concessionary words from both sides, President Trump and China’s state media have also offered some rhetoric that indicate a deal isn’t all that close. There are still a lot of U.S. beans previously purchased by China that remain unshipped, with the current marketing year running through the end of August. While the U.S. crop is in its worst shape in years, near-term weather generally looks non-threatening. The USDA’s crop condition rating held steady and while parts of the Midwest and Plains are a little dry, temperatures are expected to be mostly seasonal. An early frost is a possibility in some areas following the historically slow start to planting. Soybean meal and oil were lower, following beans.

Corn was lower on fund and technical selling. The U.S. corn condition rating improved slightly, up 1%, while national development remains more than a week behind average. Dry weather is a concern as the crop goes through pollination. Export demand is slow because of increased competition from South America and Ukraine, with DTN reporting the sale of 51,000 tons of optional origin corn to South Korea. The trade is waiting for the next round of USDA supply and demand numbers out August 12^th, which will include the USDA’s acreage resurvey results and prevent plant totals. Corn is also waiting to see what happens with China and Japan this week. Ethanol futures were mostly lower. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday.

The wheat complex was lower on profit taking and technical selling. The winter wheat harvest is 75% complete, with generally good yields and expected higher feed demand cancelling out some of the concerns about protein content and disease issues. The spring crop condition rating was down 3% on the week, but it’s still above average at 73% good to excellent. The recent spring wheat crop tour had a higher than a year ago, but still below normal, average yield estimate. In any event, the global fundamental outlook remains bearish as world production is expected to be at or near record levels, even with probable reductions in parts of Europe and the Black Sea region because of weather. DTN says Jordan has an open milling wheat tender, but U.S. wheat likely won’t be competitive because of price. The USDA’s weekly export sales numbers are scheduled for Thursday morning.