Market News

Soybeans up modestly after good export sales numbers

Soybeans were modestly higher on short covering and technical buying, ending the week mixed. Export sales topped most expectations, China was the leading buyer, and overall, the numbers were neutral to bullish, with a good week for shipments. According to reports, China has also resumed buying soybeans from Brazil, atypical for this time of year, and a sign China might not be in a rush to buy the talked about amount of U.S. ag goods. High-level face-to-face talks between the U.S. and China are expected to resume in November. The trade was also watching U.S. and South American crop weather, with rain headed for parts of Brazil, while Argentina could remain mostly dry. There are also political uncertainties that could limit Argentina’s soybean crop. Soybean meal was higher and bean oil was lower on the adjustment of product spreads.

Corn was modestly lower on profit taking and technical selling, finishing the week modestly lower. Corn was also watching U.S. crop weather, generally expecting good near-term harvest progress in many areas, except for eastern and northern portions of the region. Lower production and yield estimates are likely as harvest advances. Weekly corn export numbers were bearish, reflecting the competition from South America and Ukraine. It’s early in the marketing year, but 2019/20 sales are considerably slower than 2018/19. Corn is also watching planting and pre-planting conditions in Argentina and Brazil. Ethanol futures were lower, with production trending below the USDA’s projection for the current marketing year. The next set of supply, demand, and production numbers is out November 8^th.

The wheat complex was mixed, mostly modestly higher. Chicago and Kansas City were up, watching the winter wheat planting pace, and with both closing solidly higher on the week. Minneapolis was down on profit taking, even with the spring wheat harvest problems and quality issues in the northern U.S. Plains and Canada, cementing a modestly lower week-to-week finish. Weekly export numbers were bearish, with sales near the low end of estimates, but Mexico was the big buyer. DTN says Japan bought 115,835 tons of wheat from the U.S., Australia, and Canada. The U.S. Wheat Associates group says China’s new Tariff Rate Quota could have an impact on U.S. wheat sales. The Buenos Aires Grain Exchange lowered its outlook for Argentina’s wheat crop by 1.2 million tons to 19.8 million, citing dry weather. The National Bank of Australia now has that nation’s wheat crop at 15.5 million tons, also because of dry weather. Strategie Grains has the European Union soft wheat crop at 145.5 million tons. Allendale says Vietnam is asking Russia to suspend its wheat exports, possibly because of quality, with Ukraine and the U.S. expected to pick up some of the slack.