Market News
Soybeans, corn see more weather pressure
Soybeans were lower on speculative and technical selling. Beans continued to respond to forecasts for less threatening weather in some areas next week. Still, after this anticipated break in the weather, some outlooks do have a return to hotter, drier conditions in August, a critical month for soybean development. Old crop export sales were up on the week, mainly to China, with nearly all of that switched from unknown destinations. That followed four consecutive weeks of marketing year lows, with the last three weeks net reductions due to cancellations by unknown destinations. New crop sales were barely over a quarter million tons, primarily to China. The International Grains Council projects 2022/23 world soybean production at 386 million tons, compared to 390 million in June and 351 million for 2021/22. New crop stocks and trade were also below the previous guess. Soybean meal was lower on the generally bearish tone to the soy complex, while bean oil was pressured by a drop in crude oil.
Corn was lower on speculative and technical selling. Corn was also monitoring the weather, including an improved chance of rain in parts of the region. That should help yield prospects in some key growing areas, assuming those forecasts materialize. Hot, dry weather is also an issue in parts of Europe. Old crop export sales were bearish and China bought a small amount of new crop, not as much as had been rumored in recent sessions. New crop sales did top a half a million tons, seeing solid interest from unknown destinations, which could turn out to be China, and Mexico. The International Grains Council expects the 2022/23 global corn harvest to be 1.189 billion tons, compared to 1.19 billion a month ago and 1.220 billion a year ago. The IGC did raise the new crop world trade guess slightly while leaving ending stocks unchanged. The second crop corn harvest in Brazil is ongoing.
The wheat complex was lower on fund and technical selling. The trade was waiting for a solid development from recent talks between the U.N., Ukraine, Russia, and Turkey. That came out after the close, with reports from Turkey that Ukraine, Russia, and the U.N. will sign a deal Friday to restart Ukraine’s exports, which trickled to a comparative near halt after Russia’s invasion. That success of that deal will likely be contingent on Russia sticking to the agreement’s terms. Moscow has devastated Black Sea port infrastructure and continues to attack Ukraine, burning some fields while reportedly selling stolen Ukrainian grain. Available grain storage is also a concern in Ukraine. After canceling a tender earlier in the week, Egypt bought 640,000 tons of wheat, including 360,000 tons from France, 220,000 tons from Russia, and 30,000 tons each from Germany and Lithuania. U.S. export demand remains slower than expected, partially due to relative strength in the dollar, which makes U.S. goods more expensive on the global market. The Philippines was the biggest buyer last week, followed by unknown destinations. The International Grains Council pegs 2022/23 world wheat production at 770 million tons, compared to 769 million a month ago and 781 million a year ago. New crop trade and stocks are expected to be below the old crop totals. Reports from Russia have the winter wheat harvest at nearly 15% complete, with yields, so far, up 25% on the year.
