Market News

Soybeans up, waiting for more on China

Soybeans were modestly higher on short covering and technical buying. China is reportedly exempting U.S. beans from a tariff increase ahead of the next round of negotiations. The next high-level talks are at a still unspecified date in October. China bought 204,000 tons of new crop U.S. beans Friday morning, less than what the trade was talking about Thursday during the big rally. Still, it can take some time to put together a rumored purchase of that size. According to reports, a poll of forecasters projects Brazil’s soybean crop at a record 122.62 million tons, with current dry weather expected to abate as planting moves forward. Soybean meal and oil followed beans modestly higher. The National Oilseed Processors Association’s monthly member crush report is out next week. Ahead of the numbers, analysts expect a record monthly total for August.

Corn was modestly higher on short covering and technical buying. The USDA might not have lowered production as much as some analysts were expecting heading into the report, but it’s still down on the year by a pretty good margin. Near-term crop development weather looks mostly non-threatening to favorable. The quarterly grains stocks report is out at the end of the month and USDA’s next production estimate is due October 10^th. Corn is waiting to see what happens next with Japan and the USMCA. Ethanol futures were firm, waiting for the White House to announce a biofuels reform plan. The trade is also watching conditions in Argentina and Brazil ahead of widespread planting. South America and Ukraine have become increasingly competitive on the export market.

The wheat complex was mixed with Chicago mostly firm and Kansas City and Minneapolis mostly modestly lower. The USDA’s numbers were neutral to bearish, projecting a large world crop and record global supply, keeping contracts from following through on Thursday’s firm to modestly higher finish. Most forecasts have more spring wheat harvest delaying rain in parts of the northern Plains, which is also creating concerns about quality. Most forecasts have rain in parts of Oklahoma and Texas, but drier weather in some other parts of the southern Plains ahead of widespread winter wheat planting. Additionally, the trade is monitoring dry weather in parts of Argentina and Australia. DTN says Japan bought 10,650 tons of feed wheat from an unknown origin.