Soybeans finish the week in plus territory
Soybeans were modestly higher on fund and technical buying, ending the week firm. Beans followed the lead of bean meal, which was supported by strong demand, while vegetable oils continued their lower trend, pressuring bean oil futures. Near-term weather in South America continues to favor central Brazil. The USDA left its projections for Argentina and Brazil unchanged this week, while lowering Paraguay slightly, and CONAB raised its already record outlook for Brazil. The Buenos Aires Grain Exchange says 56% of Argentina’s crop is planted, slightly slower than average, with 75% rated good to excellent. Friday, December 10th marked the first business day since December 2nd without an announced U.S. soybean sale. The running total topped 1 million tons, mostly for 2021/22 and all to either China or unknown destinations.
Corn was modestly lower on fund and technical selling, but nearby contracts did still post week to week gains. Corn is also watching conditions in South America, with most forecasts showing a drier pattern for southern Brazil and Argentina, in-line with the La Nina pattern. The Buenos Aires Grain Exchange says 85% of Argentina’s corn crop is in good to excellent shape, but planting remains slower than average at 39%. The big question for South American corn is Brazil’s second crop, the largest of the three and source of most of their exports. Ethanol demand is solid, but the export pace remains slow. China has reportedly recently made major purchases of corn from Ukraine, but nothing official has been announced. The U.S. continues to maintain a price advantage over most other major exporters. Russia’s Ag Ministry says next week’s export tax for corn will be $54.40 per ton, up a dime on the week. Ethanol futures were unchanged.
The wheat complex was mixed. Chicago and Kansas City were up Friday on an oversold bounce and while ending stocks were up on the month, they are still expected to be well below last marketing year. Minneapolis wheat was mixed, adjusting spreads. For the week, the winter wheat pits were down despite weather concerns in some hard and soft red winter growing areas, and Minneapolis had very modest changes. The trade is monitoring border tensions between Russia and Ukraine, which could impact the export market. Russia’s Ag Ministry says that nation’s export tax on wheat will rise to $91 per ton in the coming week, compared to prior tariff of $84.90. In addition to corn from Ukraine, China has reportedly purchased significant amounts of feed wheat from France and Australia. Australia is expected to produce a record crop this year, but with lesser quality because of heavy rain in some areas during harvest.