Written Commentary
CORN
Prices were $.02-$.03 lower closing just off session lows. Spreads were steady to weaker. After trading above LW’s high, Mch-26 has pulled back to its 50 day MA support at $4.44 ¾. Export sales the week ended Oct. 23rd at 71 mil. bu. brought YTD commitments to 1.392 bil. bu. up 37% from YA, vs. the USDA forecast of up 9%. Export inspections as of Nov. 27th at 56 mil. bu. were above expectations however below the 59 mil. needed per week to reach the USDA forecast. YTD inspections at 747 mil. are up 71% from YA. Noted buyers were Mexico – 13 mil. and Japan with 17 mil. AgRural estimates Brazil’s 1st corn crop plantings have reached 99%. The CFTC will release their next COT report tomorrow showing positions held as of Oct. 21st. Prices still appear range bound. Without a weather problem in SA I suspect it will be hard for Mch-26 to trade above the November highs. Extremely strong export demand likely to hold prices above contract lows at $4.10, possibly above $4.20.
SOYBEANS
Prices were mixed with beans down $.07-$.10, meal was off $3-$5 while oil was up 30-40 points. Bean spreads weakened, oil spreads were mixed while meal spreads firmed. Early strength saw Jan-26 beans trade above LW’s high only to pull back by midday. Support is at the 50 day MA at $11.24 ½. Jan-26 meal slipped to a 3 week low with next support at $312.90. Jan-26 oil closed above its 100 day MA with next resistance at 52.80. Spot board crush margins improved $.04 to $1.40 bu. while bean oil PV jumped out to a 6 week high at 45.4%. AgRural estimates Brazilian plantings have reached 89%. Export sales at 53 mil. bu. were a MY high and brought YTD commitments to 593 mil. bu. down 38% from YA vs. the current USDA forecast of down 13%. As of Oct. 23rd still no sales to China. Meal sales at 640k tons brought YTD commitments to 6,335k tons up 14.5% YOY vs. the USDA export forecast of up 5%. Oil sales at 66 mil. lbs. brought YTD commitments to 357 mil. up 36% vs. USDA down 64%. Export inspections at 34 mil. bu. were in line with expectations and just above the 30 mil. bu. needed per week to reach the USDA forecast. YTD inspections at 436 mil. are down 46% from YA. Italy was the largest buyer at 7.5 mil. bu. while Egypt took 5 mil. and Mexico 3 mil. Friday’s EIA report showed combined biodiesel and RD capacity increased less than half of 1% in Sept-25 to 6.967 bil. gallons annually. Combined production for the month was up 14.3% to 432 mil. gallons, the highest since Dec-24. Bean oil usage was up just over 1% to 1.053 bil. lbs., however as a feedstock fell to just below 35%, the lowest in 5 months. I calculate final bean oil usage for biofuel production in 24/25 at 11.758 bil. lbs., below the USDA forecast of 11.9 bil. lbs. Look for additional switching away from usage for biofuels into other domestic usage.
WHEAT
Prices ranged from steady to $.04 lower. Mch-26 CGO held support above LW’s low at $5.31 ¾, same with KC with support at $5.19 ½. ABARES raised their Australian production forecast 1.8 mmt to 35.6 mmt, slightly below the USDA forecast in Nov-25 at 36 mmt and slightly below expectations. If realized production would be 4% above YA and the 3rd largest crop ever. Australia’s harvest as of Nov. 28th was 33% complete. The USDA is likely 1-2 mmt too low with their Argentine wheat production forecast of 22 mmt. Look for a combined record production from major S. Hemisphere producers. US export sales at 18 mil. bu. brought YTD commitments to 599 mil. bu. up 22% from YA, vs. the USDA forecast of up 9%. Export inspections at 14 mil. bu. were below expectations and just below the 16 mil. bu. needed per week to reach the USDA forecast. YTD inspections at 486 mil. bu. are up 20% from YA. Ukraine’s wheat exports as of Nov. 28th at 7.3 mmt are down 17% YOY. This fall they planted 4.7 mil. HA of winter wheat, up from 4.4 mil. HA YA.
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