Market News

Soybeans, corn up, watching weather

Soybeans were modestly higher on short covering and technical buying, but posted a slight week to week loss. Weekly new crop exports were neutral and China’s tariff on U.S. soybeans continues to hang over the market ahead of more U.S. tariffs on Chinese imports. AgriCensus says Chinese soybean meal stocks last week declined last week but remain well above a year ago. Stocks are also quite a bit larger than last year at 9.6 million tons. Most forecasts had a wet, cool weekend for many key U.S. growing areas, potentially causing some harm during key late development phases. Soybean meal was higher and bean oil was lower on the adjustment of product spreads.

Corn was fractionally higher on short covering and technical buying after an up and down session and managing a modest weekly gain. Weekly new crop corn exports were near the high end of estimates, while old crop was a new marketing year low with one day left, officially, in the 2017/18 marketing year. Corn was also watching weather and the potential for damage or early harvest delays. Ethanol futures were higher. According to DTN and the University of Missouri’s Food and Agricultural Policy Research Institute, RFS waivers for small refiners could cost the ethanol industry $20 billion over the next six years, lowering corn demand by 1.6 billion bushels over that period. In addition to the tensions with China, commodities are also monitoring trade discussions with Canada and the European Union.

The wheat complex was mostly modestly lower on fund and technical selling, except for the lightly traded September Chicago. Contracts lost a lot of ground from the previous week as rumors about a Russian export tariff or restrictions were denied by Moscow. Weekly export numbers were bearish as wheat continues to struggle with the adequate global supply and recent trend in the U.S. Dollar index. New USDA domestic and international supply, demand, and production estimates are out Wednesday, September 12th. Ethiopia and Syria both have open tenders for 200,000 tons of milling wheat. Ethiopia also has a tender for 25,340 tons of U.S. hard red winter through the Commodity Credit Corporation. The trade continues to monitor weather in Australia, the European Union, and the Black Sea region. Australia’s ABARE will update its wheat production estimate on the 11th.