Soybeans, corn give back some of recent gains
Soybeans were modestly lower on profit taking and technical selling, bouncing off of overhead resistance but generally staying above support. Contracts saw a slight correction, but losses were limited by hot, dry weather concerns in some key U.S. growing areas. Some areas will see near-term rainfall, but the precipitation is expected to miss parts of the region. Most of the crop is close to entering key development phases and if this period lasts as long as expected, it will likely lower the yield. The latest estimate from Barcharts is 48.78 bushels per acre, compared to their June guess of 48.86. New USDA supply, demand, and production estimates are out Friday at Noon Eastern/11 Central, including updated production outlooks following the USDA’s planted acreage totals. Soybean meal was lower and bean oil was higher on the adjustment of product spreads.
Corn was modestly lower on profit taking and technical selling. Corn also gave back some of the recent gains, also keeping an eye on development conditions after a week to week decline in the USDA’s condition rating. Between the reduced acreage and probable crop damage, there likely will not be a record crop in 2020, but there’s still a long way to go. Barcharts has the 2020 U.S. corn yield at 173.78 bushels per acre, compared to the June projection of 175.32. Additionally, corn might have failed to break overhead resistance but most contracts also managed to hold at support levels. There was also pressure from generally slow export, feed, and fuel demand. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Wednesday. Ethanol futures were higher.
The wheat complex was modestly higher on short covering and technical buying. The complex is watching winter wheat harvest activity and spring wheat development weather. Winter wheat harvest weather is mixed, while spring wheat has benefited from recent rainfall. The supply outlook for wheat remains bearish, especially on the global side of the ledger, which should just be reinforced on the 10th. DTN says Egypt is tendering for an unspecified amount of wheat from several sources, including the U.S., and Syria is in the market for 200,000 tons of soft wheat from Russia. According to reports, Russia’s Ag Ministry wants to put the grain export quota mechanism used from April and June in place permanently, especially between the months of January and June, when their supplies are at their tightest. Russia’s domestic wheat prices soared this year because of a faster than normal pace of sales.