Market News

Wheat sees another round of modest gains

Soybeans were lower on fund and technical selling. Soybeans continued to follow the lead of bean oil, which followed the lead of global palm oil, while watching conditions in South America. ABIOVE estimates Brazil’s 2025 soybean crop at a record 167.7 million tons, with exports projected at an all-time high of 104.1 million tons. Ahead of the open, unknown destinations bought 226,200 tons of U.S. soybeans and China picked up 202,000 tons, both for 2024/25 delivery. The USDA’s weekly U.S. sales numbers are out Thursday morning. Soybean meal was up on oversold signals and product spread adjustments, despite reports Argentina’s April to September 2024 crush was considerably larger than the same period in 2023. The USDA’s attaché in Vietnam says Hanoi has lowered its most favored nation tariff rate on soybean meal from 2% to 1%, effective December 16^th. Vietnam is a key buyer of U.S. soybean meal.

Corn was modestly higher on short covering and technical buying. Corn is monitoring planting and development weather in Argentina and Brazil, which looks generally favorable. The USDA’s updated supply, demand, and production numbers are out December 10^th and CONAB’s new outlook for Brazil will be released December 12^th. With the U.S. harvest over, the cash basis is firming, and demand is solid. The U.S. Energy Information Administration says ethanol production averaged 1.11 million barrels a day, down 3,000 on the week, but 87,000 on the year, with a record four-week average of 1.1 million barrels per day. Ethanol stocks of 22.563 million barrels were a seven-week high, climbing 524,000 from the previous week and 911,000 from a year ago, while ethanol exports averaged 144,000 barrels a day, unchanged from the week before and 66,000 above last year.

The wheat complex was modestly higher on short covering and technical buying, shrugging off the higher activity in the dollar during the session. The trade continues to keep an eye on the tensions between Russia and Ukraine, which could impact export business. That’s been a discussion point for the entirety of the war and those concerns have not driven a significant amount of business to the U.S. or other exporters because of Russia’s price dominance. The bigger impact has been on Ukraine because of damage by Russia to port infrastructure and alleged grain theft. There’s talk that Russia will plant less wheat in attempt to improve prices, which runs against Moscow’s desires to dominate that market. Stateside, forecasts have rain and snow in parts of the Plains and Midwest into the end of the month, benefitting the U.S. winter wheat crop has it eases into dormancy. The trade’s also monitoring planting and development conditions in Europe and the Black Sea region, along with harvest activity in Argentina and Australia.