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Soybeans supported by recent export sales

Soybeans were higher on commercial and technical buying, still closing the week lower following the bearish supply and demand report. China and unknown destinations bought more 2021/22 U.S. beans Friday morning, pushing the announced total for the week to 1,514,750 tons. The purchase by China was 132,000 tons and unknown picked up a combined 722,750 tons. The weekly numbers were solid, with China and Mexico the top buyers. The cancellation by unknown destinations was switched to China, Egypt, the Netherlands, and Bangladesh. Shipments were above what’s needed weekly to meet USDA projections for the 2021/22 marketing year. For next year, there’s already talk of a shortage of fertilizer leading to a shift to soybeans away from corn. The trade is also watching planting conditions in South America ahead of the expected La Nina pattern, which would likely trim yields. Soybean meal and oil were higher, following beans. The NOPA says September’s crush by member firms was 153.8 million bushels, a little bit lower than expected.

Corn was higher on commercial and technical buying but finished the week modestly lower. Parts of the region saw another round of near-term harvest delays ahead of generally more favorable conditions in the coming week. The USDA’s weekly crop progress and condition numbers are out Monday afternoon. Exports topped a million tons for the second week in a row, mostly to Mexico, followed by Guatemala. Recent private sales announcements have been hard to come by, but the underlying demand is still present and U.S. corn is competitively priced. The USDA’s attaché in Ukraine estimates 2021/22 corn production at 39.658 million tons, compared to the official projection of 39 million tons and the 2020/21 total of 30.297 million tons. Exports are expected to be 34 million tons, compared to 24.026 million last marketing year. The Buenos Aires Grain Exchange says 23.2% of central Argentina’s crop has been planted, but there are concerns about changes in export policy impacting acreage next year. Planting conditions in Brazil are generally favorable. Ethanol futures were unchanged.

The wheat complex was higher on commercial and technical buying, including another new high for December Minneapolis. While the global supply is tighter and export sales were up sharply on the week, the U.S. is priced above most competing origins. Kansas City however is becoming more competitively priced against other hard winter wheats and continues to hold the sales advantage over other types of U.S. wheat. The big weekly buyers were the Philippines and Mexico. December Chicago was steady on the week, while Kansas City was up modestly and Minneapolis was sharply higher. Recent rain in the Plains will help winter wheat, but more will be needed. There’s been talk, but no confirmation, of China buying wheat from either the U.S. or France. Grains and oilseeds also generally saw some spillover support from oats and the broader market. The USDA’s attaché for Ukraine projects 2021/22 wheat production at 32.165 million tons, compared to the official estimate of 33 million and the 2020/21 total of 25.42 million tons. Exports this marketing year are seen at 23.8 million tons, compared to 16.847 million in the previous marketing year.

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