Corn, wheat down Friday, still up on week
Soybeans were lower on fund and technical selling, pulling contracts modestly lower for the week. Early harvest activity is ongoing and planting is underway in parts of Brazil. The U.S. could see some minor delays, while portions of central Brazil need rain. China bought 132,000 tons of U.S. soybeans, showing strong export demand as their domestic prices move higher. That’s the 8th purchase this month for a running total of 694,000 tons, minus the combined 328,000 tons canceled earlier in the week by China and unknown destinations. China reportedly recently bought Brazilian beans, despite the relatively high price. Soybean meal and oil were lower, following beans. Bean oil had additional pressure from lower moves in palm oil and canola.
Corn was modestly lower on fund and technical selling, while still posting a week-to-week gain. Corn is also watching U.S. harvest activity, expecting good progress in many areas, along with planting in South America. Any near-term corn harvest delays are expected to be minor, but there are some early anecdotal concerns about disease damage and yield. Corn will need a trend line yield or better to meet demand. For South America, both Argentina and Brazil will likely increase planted area, but crops will have to contend with the expected La Nina pattern. Export demand for corn continues to be hampered by slow shipping from the Gulf following damage from Hurricane Ida. Barge costs have moved higher as business slowly resumes in southern Louisiana. Ethanol futures were unchanged.
The wheat complex was lower on fund and technical selling, but the most active months ended the week with solid gains. The trade is monitoring U.S. winter wheat planting, world spring wheat harvesting, and development conditions in Argentina and Australia. It was actually a decent fundamental week for wheat, with lower production projections for Russia and France, news that some buyers are willing to accept lower quality wheat, and dry conditions potentially impacting Argentine and Australian crops. Still, the dollar index did show some firmness at times and export demand for wheat continues to be slow just over a quarter in to the 2021/22 marketing year. The northern and northwestern U.S. Plains remain locked in a drought, possibly restricting white winter planted area, while Russia will also likely be planting winter wheat with dry conditions. The USDA’s next small grains production report is set for September 30th, along with quarterly grain stocks, and new USDA supply and demand numbers are out October 12th.