Soybeans, wheat up modestly, still down on week
Soybeans were modestly higher on fund and technical buying but ended the week lower. Most forecasts have moderate temperatures and generally dry conditions in the Midwest and Plains during the coming week. The U.S. crop is in good shape but will need timely rainfall in some areas to stay at full yield potential. The USDA’s next production estimate is out August 12th, but if changes are warranted, they might not show up until September. There was more talk of new demand from China, but nothing surfaced during the session. The USDA’s monthly crush numbers are out Monday, with an average estimate of 177.8 million bushels. Soybean meal was lower and bean oil was higher on the adjustment of product spreads; oil picked up additional support from strong veg oil demand. The sale of 222,000 tons of U.S. soybean meal to the Philippines was a non-factor. Argentina’s Ag Minister says Buenos Aires is considering reinstating an export tariff scheme that taxes unprocessed soybeans at a higher rate than soybean products.
Corn was steady to fractionally higher, still closing lower on the week. Corn was also watching the weather, expecting moderate temperatures to generally limit potential stress from dry conditions. Parts of Iowa continue to experience drought and there were reports of localized flooding. General expectations are for a very large crop this year, but likely short of the record production projected after the USDA’s prospective planting numbers in March. Mexico bought 114,300 tons of new crop U.S. corn Friday morning, but like Thursday’s sales, it provided little to no support. The 2020/21 marketing year for corn starts September 1st. Ethanol futures were unchanged.
The wheat complex was modestly higher on fund and technical buying, with the three U.S. pits ending the week lower. The recent rain missed some dry parts of the Plains ahead of hard red winter wheat planting and delayed the soft red winter harvest in some areas, supporting Chicago and Kansas City. Minneapolis popped fully higher late on light commercial support. The trade is also watching global conditions ahead of the supply and demand numbers August 12th. That will include updated domestic and global production projections. The European Commission has the European Union’s 2020/21 soft wheat crop at 116.6 million tons, compared to the June guess of 117.2 million. Exports were unchanged at 25 million tons. After issues with dry weather during planting and development, parts of Argentina’s wheat belt were hit by frost this past week.