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Soybeans, corn mixed, watching South American weather

Soybeans were mixed. Crop weather looks good in most of Brazil, which is on track for record production, while Argentina is locked in a drier trend. U.S. crush margins have gotten tighter but remain bullish. The NOPA’s November member crush numbers are out Thursday, with analysts expecting the crush to be 181.473 million bushels, which would be record large for the month. Soybean meal was supported by commercial buying and product spread trade. Bean oil was pressured by that product spread trade, profit taking after two days of gains, and the slow export pace. There’s also some continued disappointment for bean oil from the renewable biodiesel portion of the recent RVO update. Part of that slow export demand is due to U.S. bean oil’s premium to other global vegetable oils, including palm oil, and is despite the lower volumes of sunflower oil moving out of the Black Sea region.

Corn was mixed. Corn has run into overhead resistance this week, exports are slow, and ethanol demand has declined with tighter margins. The U.S. Energy Information Administration says ethanol production last week averaged 1.061 million barrels a day, down 16,000 on the week and 26,000 on the year, with stocks of 24.409 million barrels, the largest since April, and an increase of 1.152 million from the previous week and 3.526 million from a year ago. Corn is also monitoring weather in South America and the forecasts for dry weather in Argentina into next week. Brazil looks good, aside from some dryness issues in southern growing areas, but the big test will be the performance of the second crop. U.S. corn export demand continues to be inhibited by relatively high U.S. prices and competition from Brazil and Ukraine. The USDA’s weekly sales numbers are out Thursday morning.

The wheat complex was lower on fund and technical selling. Export demand for U.S. wheat is slow with Russia continuing to hold most of the market share. The conflict in Ukraine is ongoing with continued Russian attacks on infrastructure and delays in inspecting ships at ports. More vessels have moved out of Odesa this week, with facilities reportedly operating “normally” again after the recent drone strikes by Russia. There’s a cold burst in the forecast for parts of the southern Plains and many areas lack snow cover. Still, wheat is notoriously hard to kill, especially if it has gone dormant for winter, and parts of the region have seen much-needed precipitation this week. India’s government says their end of November wheat stocks were a six-year low.

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