Market News

Soybeans down on record crop, yield estimates

Soybeans were sharply lower on speculative and technical selling. The USDA is projecting a record large U.S. soybean crop with an all-time high for yield and higher acreage numbers, along with larger new crop U.S. ending stocks. The USDA says 68% of the U.S. soybean crop is in good to excellent condition, unchanged, but with 1% moving from good up to excellent, with 91% of the crop blooming and 72% at the pod setting stage, both ahead of the respective five-year averages. Soybean meal and oil were lower on the fundamental implications of a record large U.S. soybean crop. The old crop production guess for Argentina was slightly lower and Brazil was unchanged. CONAB’s updated outlook for Brazil will be released Tuesday. For new crop, there were no changes to South American production, but the USDA did trim Argentina’s exports a little. China’s 2024/25 import guess was steady at 109 million tons, still a little bit below the 2023/24 projection of 111.5 million tons. U.S. soybean export inspections were up on the week, down on the year, primarily to Germany and China. Ahead of Monday’s open, unknown destinations bought 300,000 tons of U.S. soybeans, with 100,000 tons for 2023/24 delivery and the remaining 200,000 tons for 2024/25.

Corn was higher on short covering and technical buying. The USDA raised production from July and expects a record yield, but new crop ending stocks were down on export expectations, while still holding above 2 billion bushels, for now. Planted and harvested area numbers were lower, both down 1% on the month. As of Sunday, 67% of U.S. corn is called good to excellent, steady, while is 94% silking, matching the average, with 60% at the dough making stage and 18% dented, both faster than normal. Globally, the USDA lowered new crop production outlooks for the European Union, Russia, and Ukraine due to weather issues, also reducing exports for all three. U.S. corn export inspections were below the previous week, but larger than last year, with Mexico and Japan leading the way. Nearing the end of the 2023/24 marketing year, inspections remain on pace to meet or exceed the USDA’s estimate. Monday morning, the USDA reported the sale of 165,000 tons of 2024/25 U.S. corn to unknown destinations.

The wheat complex was mixed. Chicago and Kansas City were down with U.S. winter wheat production up on the month and the year. For winter wheat, 93% of the crop is harvested, compared to the usual rate of 91%. Minneapolis was higher with a month-to-month cut in the spring wheat guess, even with a record yield guess. That could come down given some of the recent conditions in parts of the northern U.S. Plains, which has also impacted production in Canada. For spring wheat, 72% of the crop is rated good to excellent, 2% lower, and 18% is harvested, compared to 21% normally heading into mid-August. The USDA raised new crop world production on upward revisions for Australia and Ukraine, which canceled out month-to-month reductions for the U.S. and E.U. The USDA increased export expectations for Australia and Ukraine as well. Wheat export inspections were higher than the prior week and a year ago, with Brazil and the Philippines topping list, continuing the solid start to 2024/25.