Soybeans up, despite recent rain in parts of Midwest

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Soybeans up, despite recent rain in parts of Midwest

Soybeans were modestly higher on short covering and technical buying, rallying after early modest losses. Recent rainfall should help development, but medium-term forecasts are generally drier for some key U.S. growing areas and totals weren’t enough to break drought conditions in parts of the region. Still, temperatures for the most part don’t look threatening and August is a critical month for soybean development. In any event, the crop is heading into August with its’ highest good to excellent rating in years. New crop export sales last week were 122.9 million bushels, mainly to China and unknown destinations. A wire survey has 2020/21 Brazilian soybean production at 130.74 million tons on an increase in planted area as that nation also tries to meet demand from China. Soybean meal and oil were up, following beans.

Corn was steady to fractionally higher. Corn is also watching development conditions with expectations for a big crop this year. Some analysts are talking about a national yield of more than 180 bushels per acre, but any actual sign of that is still a couple of months off and parts of the Midwest and Plains have experienced some crop stress. Weekly export sales were neutral to slightly bearish, including a net cancellation for old crop, with about a month left in the current marketing year. Ahead of the open, the USDA reported China bought 1,937,000 tons of U.S. corn and unknown destinations purchased 130,000 tons, both for new crop delivery. Over the last two months, China has reportedly sold nearly all corn offered through the auction of state reserves. Ethanol futures were unchanged. South Africa’s Crop Estimates Committee sees 2020 corn production at 15.545 million tons, up slightly on the month.

The wheat complex was mixed, with Chicago and Kansas City down and Minneapolis up. Rainfall is delaying winter wheat harvest activity in some areas, but it should be beneficial for fall planting. The trade is also keeping an eye on late spring wheat development conditions and early harvest activity. Weekly export numbers were solid, even if China didn’t buy any U.S. wheat last week as rumored and the global supply outlook remains bearish. Some private firms have lowered estimates recently for key exporters but raised outlooks for others. The fundamental bearishness for wheat should be borne out again in the supply and demand numbers August 12th. DTN says Tunisia is tendering for 130,000 tons of soft wheat.