More support for soybeans, corn

Market News

More support for soybeans, corn

Soybeans were sharply higher on commercial and technical buying. Wednesday’s USDA numbers were bearish but did have some solid demand indicators and some areas will see a drier weather pattern starting next week. That could potentially stress the crop during key phases of development. Export demand is strong, especially for new crop U.S. beans, with last week’s 2020/21 sales topping 100 million bushels, with China the biggest buyer of both old and new crop. Thursday, China bought 197,000 tons of U.S. beans and unknown destinations purchased 202,000 tons, all for new crop delivery. That is seven business days in a row with a new sale, for a running total of nearly 2.4 million tons. The U.S. and China will be discussing the Phase One trade deal this weekend. Soybean meal was sharply higher and bean oil was lower on the adjustment product spreads.

Corn was solidly higher on commercial and technical buying. The USDA is projecting a record crop, but that is expected to be trimmed somewhat by recent storm damage and the expected dry weather in some key U.S. growing areas. Recent trade might be a sign corn has put in a seasonal low, but it will take more than a couple of sessions to figure that one out fully. Weekly export numbers were neutral to bearish with less than a month left in the 2019/20 marketing year. South Korea was the biggest buyer of old crop and Colombia led the way for new crop. Unknown destinations Thursday picked up 110,000 tons of U.S. corn, with 30,000 tons for 2019/20 and 80,000 tons for 2020/21. Ethanol futures were unchanged.

The wheat complex was higher on short covering and technical buying, along with lower trade in the U.S. dollar. The USDA’s numbers were neutral to bearish with a record projected world supply, but contracts are oversold and took the path of least resistance. The next set of supply, demand, and production numbers is out September 11th. Still, some months were unable to break overhead resistance and those bearish global fundamentals should continue to limit the upside. The weekly export numbers were bearish, with South Korea the top weekly purchaser. Domestically, the trade is back to watching the tail of the winter wheat harvest and conditions ahead of planting, including drought in parts of the Plains, along with the delayed spring wheat harvest. The Rosario Grain Exchange has lowered its planted area estimate for Argentina’s wheat crop, citing dry weather, but left the production projection at 18 million to 19 million tons, for now. SovEcon sees Russia’s wheat crop at 80.9 million tons, up 1.6 million from the prior guess.