Market News

Soybeans regain some ground

Soybeans were higher on commercial and technical buying. Contracts bought back part of Monday’s losses, with support from the solid demand outlook and the rally in bean meal. Bean meal was up on the adjustment of product spreads, which pressured soybean oil. The demand outlook for soybean oil remains positive due to biofuels demand projections. U.S. harvest activity will see some delays and South American planting conditions are mixed. There’s some rain in the forecast for parts of Argentina, along with northern and central Brazil, while portions of southern Brazil remain excessively wet. CONAB’s updated outlook for Brazil and the USDA’s next round of supply, demand and production projections are both out November 9^th. New crop soybean selling in Brazil is reportedly ahead of last year, but behind the four years prior to that. Argentina says it will extend its export incentive program for another month.

Corn was modestly lower on fund and technical selling. Corn is watching U.S. harvest activity, with rain and even snow in the forecast for some areas over the next week. That will delay harvest and would likely increase dry down costs for many producers. Mexico bought 117,200 tons of U.S. corn for delivery this marketing year. These sales to Mexico are almost becoming routine and it seems like the trade would like to see announced purchases by other buyers, including China. U.S. corn is competitive thanks to higher prices in Brazil, the tight supplies in Argentina, and the movement issues in Ukraine due to the ongoing war with Russia. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday.

The wheat complex was lower on fund and technical selling. Winter wheat planting and emergence are near average, with some welcome rainfall in the southern Plains ahead of the crop heading into dormancy. There’s also precipitation in the forecast for parts of the eastern Midwest and the spring wheat region. Export demand for U.S. wheat is slow as Russia continues to control the market. There are some opportunities for U.S. wheat due to high prices in China and expected demand from India, but nothing’s really surfaced yet. Recent rainfall in Argentina and Australia has likely stabilized crops to some degree, but there’s a long way to go for both crops. What does happen in the Southern Hemisphere will at least partially dictate demand for U.S. wheat. There’s been more talk, but no confirmation, of new purchases of U.S. wheat by China.