Market News

Soybeans, corn supported by harvest delays

Soybeans were sharply higher on speculative and technical buying, with all contracts except for spot November closing above $9. The trade was expecting the USDA to report a slowdown in harvest after a wet, cool, and even snowy week in parts of the Midwest and Plains. The potential for damage from some combination of wet and cold also exists. The USDA reports 95% of U.S. beans are dropping leaves, compared to the five-year average of 92%, with 38% of the crop harvested, compared to 53% on average. 66% of the crop is rated good to excellent, down 2% on the week. There’s also been talk of China buying soybean meal, but nothing’s surfaced yet and China’s tariffs remain in place ahead of an expected meeting between President Trump and President Xi at the G20 summit in Argentina in November. No formal talks between Washington D.C. and Beijing have been announced. The soybean meal rumors did support futures and the higher move in beans and meal also pulled bean oil higher. High water levels have closed some locks on the Mississippi River, limiting movement. The National Oilseed Processors Association says member firms crushed 160.779 million bushels of soybeans in September, a new high for the month and up 18% on the year. AgRural reports Brazil’s soybean planting is 20% complete, compared to 12% a year ago and 10% on average.

Corn was higher on speculative and technical buying, along with spillover from beans and bean meal. Corn was also expecting a slower harvest pace, but that’s mostly a bigger issue for beans than corn. Still, the potential for damage from mold shouldn’t be downplayed. As of Sunday, 96% of the crop is mature, compared to 91% normally this time of year, and 39% is harvested, compared to the usual pace of 35%. 68% of corn is in good to excellent shape, unchanged from last week. Conditions most of this week generally look better for harvest activity. Ethanol futures were mixed, mostly firm. Corn is waiting for Congressional introduction and advancement of the USMCA, or “new NAFTA”. According to AgRural, 44% of Brazil’s first corn crop is planted, compared to 37% last year and the usual pace of 38%. Brazil’s second crop is the larger of the two and source of most of their exports. Friday’s USDA Cattle on Feed report could be nominally positive for feed demand.

The wheat complex was higher on short covering and technical buying, rallying slightly after a slow start to the session, with help from the lower U.S. Dollar index. Winter wheat planting delays were likely, but the soil moisture is welcome in many areas, especially the southwestern Plains, as the crop heads towards dormancy. The rain was also disruptive in winter wheat parts of the central and eastern Midwest that had sufficient soil moisture. According to the USDA, 65% of U.S. winter wheat is planted, compared to 67% on average, while 44% has emerged, compared to the normal pace of 41%. The trade is also watching planting and development conditions in Australia, China, Europe, and South America, along with the tail end of the spring wheat harvest in Canada. Early reports from Western Australia have some producers considering baling their crop ahead of a possible El Nino event that would cause more dry weather. More crop loss in likely in key global growing areas, but for now, the overall fundamental outlook on wheat remains bearish. DTN says Syria is tendering for 200,000 tons of milling wheat and Jordan is in the market for 120,000 tons of wheat.