Market News

Soybeans down on slower than expected sales to China

Soybeans were modestly lower on fund and technical selling. China bought another 126,000 tons of 2019/20 U.S. soybeans, but at 964,000 tons, the three-day total has fallen short of some expectations. Beijing has reportedly cleared importers to buy as much as 6 million tons of U.S. beans tariff free. Friday, the White House was reportedly looking for ways to limit U.S. investment in China. Negotiations between the U.S. and China are scheduled to resume in October. The trade is also watching weather in the U.S. and South America, with the potential for rain in dry parts of Brazil, which might miss portions of Argentina. Soybean meal was mostly weak and bean oil was lower. According to reports, China’s efforts to raise larger hogs and meet domestic pork demand in the face of the spread of African swine fever is leading to improved soybean meal demand.

Corn was modestly lower on fund and technical selling. Near-term forecasts have harvest delaying rain in some areas but with warm temperatures, while there is the chance of a frost or freeze for the northern Midwest in the coming week. Parts of the region could even see heavy early season snowfall. Export demand continues to be a big bearish factor, with competition from Argentina, Brazil, and Ukraine. Ethanol futures were higher, despite the lack of a biofuels reform package from the White House. That and the USMCA could be delayed by the impeachment inquiry. The European Commission sees E.U. corn at 66.5 million tons, down 2 million from August, with imports of 17 million tons, compared to 15.5 million a month ago.

The wheat complex was mixed. Chicago and Kansas City are watching winter wheat planting, while Minneapolis expects more spring wheat harvest delays and quality concerns. The issues impacting the U.S. spring wheat crop are also present in Canada and those struggles would get worse if weather follows the forecast. New USDA small grains and quarterly stocks numbers are out on Monday at Noon Eastern/11 Central. The European Commission has E.U. common wheat production at 145 million tons, compared to 142.7 million and 128.8 million tons last year, with exports steady at 25.5 million tons. The trade is also watching weather in Argentina and Australia. DTN says Ethiopia, Bangladesh, and Turkey all have open wheat tenders.