Market News

Soybeans, corn down on Brazil, dollar, trade questions

Soybeans were sharply lower on commercial and technical selling. Brazil’s equivalent of the USDA, CONAB, did lower its domestic production outlook, but not by as much as what some in the trade were expecting. At 118.8 million tons, it’s also more than what many private firms are currently projecting. The USDA’s next guess was scheduled for Friday, but that’s delayed by the partial shutdown of the federal government. There’s also some disappointment connected to a lack of public progress in trade talks between the U.S. and China, but the USTR is optimistic and Cabinet level discussions are expected to occur at the end of the month. Soybean meal and oil were also sharply lower, following the lead of beans. Another bearish factor for commodities was the U.S. Dollar index, which rebounded from Wednesday’s new lows.

Corn was lower on commercial and technical selling. Corn was also pressured by CONAB’s new corn production guess. Brazil’s first crop is currently pegged at 27.5 million tons, for a combined crop of 91.2 million, probably leading to increased export competition once harvest gets underway. Still, both corn and beans in Brazil will have to contend with weather issues in some key growing areas that might still have an impact on production. Corn is also waiting for further advancement in trade discussions and watching for any signs of new export demand from private sources. Ethanol futures were lower.

The wheat complex was lower on commercial and technical selling. Wheat had residual disappoint from Wednesday’s purchase by Egypt, all of which went to Russia, contrary to a number of expectations. U.S. wheat was competitively priced, but less expensive shipping was likely a factor, even as Russia’s exports move out faster than anticipated. Part of Wednesday’s purchase by Algeria might have been U.S. wheat, but with the shutdown, export information is hard to come by. With no weekly numbers, Monday’s export inspections report will probably start to carry more importance. DTN says a handful of export tenders remain open, with the possibility of some of that coming from the United States. South Korea bought 65,000 tons of feed wheat from an unknown origin.