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Strong gains for wheat at midweek

Soybeans were mixed. Soybeans consolidated, while watching U.S. harvest activity. Early spillover pressure from soybean meal abated after that came up from its lows. The drop in meal was linked to profit taking and the European Union said it would delay a plan to cut imports of ag commodities from deforested areas. That likely would have moved some business from Brazil to the U.S. Stateside, harvest weather looks mostly favorable and a private firm raised its already record yield guess. The trade is also watching planting weather in South America. The USDA’s updated supply, demand, and production numbers are out October 11th, with CONAB’s new projections for Brazil set for the 15th. StoneX sees Brazil’s new soybean crop at 165.03 million tons, unchanged from the prior estimate. Aside from the routine reported sales Monday and Tuesday, actual demand from China ahead of Golden Week did not meet expectations. Soybean oil was up on the higher move in crude oil, which surged on the tensions in the Middle East, but backed off a little after OPEC+ announced smaller than expected production cuts later this year. As of Wednesday morning, there were no deliveries against October soybean oil.

Corn was modestly higher on fund and technical buying. Feed, fuel, and export demand remain solid, helping corn find support even with strong or record yield results in some key U.S. growing areas. Medium-term forecasts have rain for dry parts of Argentina and Brazil, but those areas will need more consistent precipitation throughout the remainder of the planting window, into development. StoneX projects Brazil’s first corn crop at 24.87 million tons, slightly below the previous guess.  The U.S. Energy Information Administration says ethanol production last week averaged 1.015 million barrels a day, up 21,000 on the week and 6,000 on the year, with stocks of 23.459 million barrels, a decrease of 65,000 from the previous week, but an increase of 1.575 million from a year ago. Ethanol exports averaged 102,000 barrels per day, 15,000 more than the prior week, but 20,000 less than this time last year.

The wheat complex was higher on speculative and technical buying. That pulled the most active months Chicago, Kansas City, and Minneapolis above the respective 100-day moving averages. Dry conditions are an ongoing concern in the southern U.S. Plains and Black Sea region of Russia and Ukraine, while some soft red winter growing areas in the southeast are excessively wet post-Helene. A recent frost in parts of Australia is expected to lead to at least some crop loss, potentially topping 1 million tons, and there are questions about Argentina’s crop following weather issues throughout the growing season. SovEcon now sees Russia’s 2024/25 wheat exports at 47.6 million tons, a half million less than the last guess because of weather. The USDA’s weekly U.S. sales numbers are out Thursday morning. Egypt has reportedly purchased an immense purchase of wheat from an unnamed seller.

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