Soybeans lower on early strong harvest numbers

Market News

Soybeans lower on early strong harvest numbers

On Monday, soybeans closed lower, and corn and wheat closed mixed.

Soybeans continued losses on Monday after lower overnight trading amid harvest pressure as U.S. growers continue to get their crops out at a faster than normal pace. Nearby contracts saw initial gains before falling ahead of midday. Thoughts of a modestly better than expected harvest could help fuel continued lower moves in the soy complex. Favorable South American weather is also putting downward pressure on the soy complex. Weekly export inspections improved with weekly crop progress expected to be steady amid an ahead of average harvest pace. Chinese demand continues to be a question mark moving forward which is adding potential volatility into the market. Concerns of increased production by competitors could cause traders to be bearish on U.S. beans for the near-term. USDA says 16 percent of the crop was in the bin at the start of last week, ahead of the prior five-year average of 13 percent for this time of the year.

Corn closed mixed to lower on Monday as it continues to watch harvest progress. The crop traded weaker overnight heading into Monday but leveled off as early, slightly higher, movement become mixed by the close. Harvest continues to pick up but is still mostly leading to sideways movement. But scattered shows across much of the Eastern Cornbelt is causing some harvest delays. Forecasts show chances of continued rain East of the Mississippi River as this week develops. Favorable weather for South American planting, especially in Brazil, is adding downward pressure into the corn market as traders’ expectations for corn production by the competitor rise. Ethanol margins are expected to struggle in the short-term with lower-than-normal seasonal demand for fuel from drivers which is also adding downward pressure into the corn market.

Wheat closed mixed for the day as upward movement from total wheat stocks in several key wheat states is leveling off. Last week, USDA said North Dakota, South Dakota, Minnesota, and Montana had the smallest wheat stocks for this time of the year since 1961 which caused large gains in the wheat complex. That’s still adding bullish support in the market as U.S. wheat supplies are expected to remain tight throughout the winter months. Other key wheat growing countries like Russia and Argentina are dry, needing rain to boost the expected production of their wheat crops. Continued dry weather in those and other areas could re-establish an upward push in the market. The value of the dollar has backed off of its highs but remains at the upper end of its range which is making U.S. grain more expensive on global level causing some prices to drop.