Corn, soybeans up watching harvest activity
Soybeans were modestly higher on commercial and technical buying, bouncing back after early losses. Most forecasts have generally good harvest conditions in much of the Midwest and Plains this week. The USDA says 60% of U.S. soybeans are harvested, compared to the five-year average of 55%, and 95% are dropping leaves, matching the normal pace. Some mid-week storms are likely, but delays are expected to be minimal in much of the region. Export inspections topped 2 million tons, up on the week, down on the year, mainly to China and Mexico. About a month and a half into the marketing year, the 2021/22 pace trails 2020/21 by a wide margin. There’s been talk, but no confirmation, yet, of China buying soybeans this week as their crush margins move back toward all-time highs. The trade is also watching planting conditions in South America, still generally favoring Brazil over Argentina. Long-term, there are uncertainties about production because of the advancing La Nina pattern. Soybean meal was mixed on bull spreading, while bean oil was supported by strong global vegetable oil demand.
Corn was higher on commercial and technical buying, finishing the session just under the highs after starting the day lower. Corn was also watching U.S. harvest conditions ahead of the weekly crop progress and condition numbers. As of Sunday, 52% of U.S. corn is harvested, compared to 41% on average, and 97% is mature, compared to 93% usually in mid-October, with 60% of the crop in good to excellent condition, steady on the week. Planting weather looks good for Brazil, while Argentina needs more rain as the La Nina pattern starts to emerge in South America, which could limit yields. Export inspections were above the previous week and last year with Mexico and China leading the way. China’s General Administration of Customs says September corn imports were 3.53 million tons with year-to-date purchases at 24.93 million tons, well above a year ago. It’s unlikely all that much of September’s buys were from the U.S., but the U.S. does have a price advantage over competing feeds. Ethanol futures were unchanged.
The wheat complex was mixed, with Chicago and Kansas City, following corn, and Minneapolis mostly weak on spread trade and profit taking. U.S. winter wheat planting conditions are mixed, with more rain needed in some key growing areas. According to the USDA, 70% of winter wheat is planted, compared to 71% on average, while 44% had emerged, compared to the typical rate of 47%. French milling wheat was lower ahead of the U.S. session, reversing course after hitting a contract high. Export demand for U.S. wheat remains slow due to relatively high prices. Kansas City is a little bit more competitive than Chicago or Minneapolis. Export inspections were below the prior week and a year ago with Mexico and Venezuela topping the list. China’s General Administration of Customs says wheat imports for September were 640,000 tons, down 40.4% on the year, with year-to-date imports at 7.59 million tons, still 25.3% ahead of 2020. The trade is also watching winter wheat planting conditions in Europe, Russia, and Ukraine, along with development weather in Argentina and Australia. SovEcon says Russia’s wheat planted area could be down 5% on the year because of weather issues and high fertilizer prices.