Soybeans up on condition rating, exports
Soybeans were sharply higher on fund and technical buying. The USDA says 56% of U.S. beans are rated good to excellent, down 1% on the week, and 16% is called poor to very poor, up 1%. Beans will need a trend-line yield or better to meet demand expectations and limit further price inflation for end users. China bought 132,000 tons of new crop U.S. beans, with a monthly total near 1.377 million tons just for China. Some of those sales reported as heading to an unknown destination could be switched to China when it’s time for delivery. Soybean meal and oil were also sharply higher. Rain is in the forecast for parts of South America, but it’s expected to miss the driest portions of Argentina, the world’s biggest export of soybean products. Interior movement to port is an issue in Argentina because of low water levels on the Parana River. That rain will help to recharge soil moisture in Brazil ahead of widespread planting, but more is needed.
Corn was higher on fund and technical buying. 60% of corn is in good to excellent shape, 2% lower, the third lowest rating in more than a decade. The USDA’s next production guess is out September 10th. Mexico picked up 125,300 tons of new crop U.S. corn, with the 2-day total at 583,900 tons. The new marketing year for corn, and soybeans, starts September 1st. U.S. corn has a price advantage over nearly every other global feed grain supplier, except for Argentina. Ethanol futures were unchanged. The U.S. Energy Information Administration’s weekly ethanol production and supply numbers are out Wednesday. The European Union’s crop group MARS raised its outlook for the community’s corn crop. AgRural says 79% of Brazil’s second corn crop is harvested, while 4.1% of the third crop is planted.
The wheat complex was mixed, with Chicago down, Kansas City mostly weak, and Minneapolis mostly firm. 77% of spring wheat is harvested, well ahead of average, with rain delays likely in parts of the northern Plains. While that will help to recharge soil moisture ahead of winter wheat planting, white winter planting in northwestern areas could be slashed if there’s not sustained rainfall. The trade is also watching spring wheat yields in Canada. Russia has collected 62.2 million tons of wheat, compared to 67.4 million a year ago, with yield also down on the year. Dry weather is a likely issue in parts of Argentina, which is the big supplier for the Mercosur trading bloc. The Rosario Grain Exchange says La Nina could reduce rain in Argentina by 20% to 30% this growing season. The E.U.’s MARS lowered its guess for European soft wheat yields, but it’s still expected to be above average. Conversely, conditions are generally good in Australia. DTN says Japan is tendering for 81,853 tons of food wheat from the U.S. and/or Canada, and Bangladesh is in the market for 50,000 tons of wheat.