Market News
Wheat, corn up after USDA numbers
Soybeans were mixed, mostly firm, consolidating, unable to hold on to the post-USDA report gains, but well above the losses prior to those numbers. The USDA’s production guess is up on the year, but down on the month, with the average yield fractionally lower than a year ago. Soybeans will need a trend-line yield or better to meet demand expectations and limit further price inflation for end users. Old crop U.S. ending stocks were higher, while new crop held steady. The Rosario Grain Exchange estimates 2021/22 soybean production for Argentina at 49 million tons, compared to 45 million for 2020/21, which was impacted by drought. That will change if the expected La Nina pattern hits this fall and exports are being affected by low water levels on the Parana River. China and the USDA both lowered 2020/21 soybean import expectations because of crush margins. Thursday, unknown destinations bought 198,000 tons of 2021/22 U.S. beans and China picked up 132,000 tons, bringing the total over the past 6 business days to 1.259 million tons, all new crop, either to unknown or China. In the weekly numbers. China was the big buyer on old crop, while unknown led the way for new crop. Soybean meal was steady to higher and bean oil was mostly weak, with both adjusting spreads.
Corn was solidly higher on commercial and technical buying, ending the session near the middle of the day’s range. The USDA’s domestic crop and yield estimates were both lower than expected and below July, with a bigger than expected cut for Brazil’s crop. Still, the USDA’s guess for Brazil is a little bit above what CONAB projected earlier in the week. Old crop U.S. stocks were up, new crop was down. The Rosario Grain Exchange has 2021/22 corn production in Argentina at 55 million tons, up 1 million from their last guess. Ethanol futures were unchanged. Old crop export sales were up solidly on the week with Mexico topping the list, while the leading new crop buyer was unknown destinations. Strategie Grains has the 2021 European Union corn crop at 66.3 million tons, compared to 65.7 million a month ago.
The wheat complex was sharply higher on commercial and technical buying, with the strongest gains in Chicago and Kansas City. The USDA lowered U.S. and world wheat crop outlooks following weather issues for some major producers. Domestic and global ending stocks estimates were also down on the month. There’s a full look at all the changes for wheat, corn, and soybeans in the news section on our website. The Rosario Grain Exchange sees Argentina’s new wheat crop at 20.1 million tons, compared to the prior projection of 20.5 million. Weekly old crop wheat export sales were lower than average, with unknown claiming the top slot. The 2021/22 pace continues to trail 2020/21, but it’s still early. Strategie Grains projects 2021 European Union soft wheat production at 131.5 million tons, compared to 133 million in July, with exports at 32.7 million tons, compared to 31 million a month ago. The firm also reduced global all wheat production 14 million tons to 750.3 million. Russia’s Ministry of Ag has wheat production at 81 million tons, compared to 85.896 million in 2020.
