Market News

Soybeans down after APEC cancellation

Soybeans were modestly lower on fund and technical selling. Chile has canceled the APEC meeting scheduled for November where Phase One of the U.S./China trade deal was expected to be signed. No make-up date has been announced yet. There have been conflicting signals on whether anything would have been signed at the meeting, with the U.S. concerned about the apparent lack of purchases of ag goods and China unhappy with the U.S. being outspoken about human rights issues. President Trump says China wants to buy as much as $50 billion worth of U.S. ag goods, while China has recently stated purchases will depend on a combination of market factors, need, and price, not as an outright part of negotiations. The trade is also watching the slow U.S. harvest activity and planting in Argentina and Brazil. Unknown destinations bought 132,000 tons of 2019/20 U.S. beans Wednesday morning. That might be China, or it might not be either, and the purchase was seen as a routine sale. Soybean meal was lower, following beans, and oil was mixed, consolidating.

Corn was modestly higher on short covering and technical buying. Near-term, parts of the Midwest and Plains will see more harvest delaying weather ahead of a mostly less wet, but cold, pattern. Anecdotally, yields have varied and even where the numbers have been good, moisture content has been higher than normal. Corn is also monitoring planting in South America. New USDA supply, demand, and production estimates are out November 8^th. DTN says Taiwan is tendering for 63,000 tons of corn and South Korea is looking for 140,000 tons; both tenders are optional origin. The USDA’s weekly export numbers are due Thursday morning. Ethanol futures were mostly steady. The U.S. Energy Information Administration says ethanol production last week averaged 1.004 million barrels a day, up 8,000 on the week, while stocks dropped 265,000 barrels to 21.099 million, a two-year low.

The wheat complex was modestly lower on fund and technical selling. Winter wheat planting is ahead of average and the recent rain and snow should generally be beneficial for the emerging crop. The U.S. spring wheat harvest is officially over for the year and Canada’s harvest is moving forward. The USDA expects a record world supply at the end of the marketing year, with the next projection out a week from this Friday. According to reports, Argentina is expected to increase wheat exports to Vietnam, stepping in for Russia, which was suspended because of the presence of thistle seeds in at least one shipment. The Buenos Aires Grain Exchange projects Argentina’s 2019/20 wheat crop at 19.5 million tons. DTN says Egypt bought 115,000 tons of wheat from Ukraine and 60,000 tons each from France and Romania, while Jordan purchased 60,000 tons of wheat from an unnamed supplier. Ethiopia is tendering for 600,000 tons of milling wheat.