Soybeans, corn down ahead of week’s USDA reports

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Soybeans, corn down ahead of week’s USDA reports

Soybeans were lower on fund and technical selling. Recent rainfall in some areas might have boosted yield outlooks, with traders getting ready for the weekly USDA crop numbers. The USDA says 57% of U.S. soybeans are rated good to excellent, up 1%, with 96% at the pod setting stage, matching the five-year average, and 18% of the crop dropping leaves, compared to 15%. Beans will need a trend-line yield or better to meet demand expectations. Barchart sees this year’s crop at 4.5 billion bushels with an average yield of 51.3 bushels per acre, above the USDA’s August estimates. Grain movement has resumed on the lower Mississippi River but repairs still need to be made on some Gulf terminals and electricity remains out for most of New Orleans. Weekly export inspections were bearish coming in well below last week and last year, but it’s still very early in the marketing year and the numbers were likely impacted by the issues in the Gulf region. The leading destinations were Mexico and Indonesia. The trade is also monitoring weather and early planting activity in Argentina and Brazil. China’s General Administration of Customs says August soybean imports were 9.49 million tons, compared to 8.68 million in July and 9.6 million for August 2020. Soybean meal and oil were lower, following beans. Brazil will reportedly reduce minimum biofuel in diesel from 13% to 10% because of rising soybean prices. Australia’s Bureau of Agricultural and Resource Economics and Sciences pegs canola production at 5.03 million tons, compared to the prior projection of 4.2 million tons.

Corn was lower on fund and technical selling. The pit also getting ready for the weekly crop numbers and Friday’s updated production projections. As of Sunday, 59% of U.S. corn is called good to excellent, 1% lower, with 95% at the dough making stage, compared to 94% on average, 74% of the crop is dented, compared to 69% normally in early September, and 21% of the crop is mature, compared to 19% on average. Barchart estimates the U.S. crop at 15.4 billion bushels with an average yield of 183.6 bushels per acre, considerably larger than what the USDA was expecting in August. Friday’s crop production estimates will include updated acreage data and will be based on objective yield data, not farmer surveys. For the week ending September 2nd, export inspections were down on the week and the year, with Mexico and Japan the top destinations. Corn is also monitoring movement on the lower Mississippi River and repairs to export facilities in the Gulf post-Ida. AgRural 95% of Brazil’s old second crop is harvested and 10% of the new first crop has been planted. CONAB’s next round of production estimates for Brazil is out Thursday. Ethanol futures were unchanged. The U.S. Energy Information Administration’s weekly ethanol production and stocks numbers are out Thursday.

The wheat complex was lower on fund and technical selling. The USDA is expected to lower world production and ending stocks in Friday’s numbers, at least to some extent. Reduced crop expectations for the U.S., Canada, and Russia are a relatively safe bet, but the department will likely raise projections for Ukraine and Australia. Australia’s Bureau of Agricultural and Resource Economics and Sciences estimates wheat production at 32.63 million tons, up sharply from the previous guess, and while that is down slightly on the year, it’s way above average thanks to improved weather. Canada’s next governmental estimate is due on the 14th. Barchart has Canada’s crop at 773.1 million bushels with an average yield of 47.9 bushels per acre, a lot more than Ottawa’s most recent estimate, and sees U.S. hard red winter averaging 45.5 bushels per acre, 1 more than the current USDA mark. For spring wheat, 95% is harvested, compared to the normal rate of 83%. For winter wheat, 5% of winter wheat is planted, compared to the five-year average of 3%. Just over a quarter into the marketing year, 2021/22 inspections remain behind 2020/21. The main weekly destinations were Mexico and the Philippines. Nigeria bought 327,300 tons of 2021/22 U.S. hard red winter wheat Tuesday morning. DTN says Bangladesh is tendering for 50,000 tons of wheat.