Written Commentary
CORN
Prices were $.08-$.10 higher, closing near session highs in volatile 2-sided trade. Spreads were mixed. Sept-26 futures closed above $5 for the first time in 2 ½ years. Next resistance is $5.04 ½, the Feb-25 high on the weekly chart. Dec-26 traded into new contract highs in late trade. Crop ratings fell 3% to 57% G/E, vs. expectations for a 1% drop. Overall ratings fell to a new low for the growing season, holding below the historical average. 86% of the crop is in the dough stage, 45% is dented while 6% of the crop is mature, all at or ahead of the 5-year Ave. Updated ratings suggest an average US yield of 180.1 bpa with production at 15.953 bil. bu., 60 mil. below the USDA forecast of 16.013 bil. Dec-26 closed higher 8 of the past 10 sessions with today’s high $.99 above the June low. We had MM’s buying another 17k contracts yesterday extending their long position to 321k, likely over 330k after today, the largest in 3 months. The European Union Monitoring Agricultural Resource unit (MARS) cut EU corn yield est. 5% to 6.61 mt per HA. Brazil’s 2025/26 2nd crop harvest has reached 92%, still lagging the 98% pace from YA while the 1st crop plantings for 26/27 are underway at 2% complete. Fun fact: Since 1980 December corn has never peaked in the month of October. Perhaps this is October’s year.
SOYBEANS
Higher trade across the complex with beans up $.12-$.14, meal was steady to $1 higher while bean oil was up 40-50 points. First resistance in Nov-26 beans is LW’s high at $12.44 ½ followed by its July contract high at $12.56 ½. Early weakness in soybean oil was driven by fears the EPA may provide SRE relief of up to 1.8 bil. RIN’s, above previous expectations of 1.2-1.3 bil. D4 RIN’s have traded as low as $1.92, down nearly $.60 from the July peak as the EPA is expected to issue rulings on 34 SRE exemption requests dating back to July-24. Crush margins fell another $.07 ½ to $2.19 ½ bu, a fresh 5-month low. The USDA announced a flash soybean sale of 132k mt to an unknown buyer, driving expectations for additional Chinese demand. Crop ratings fell 1% to 60% G/E, in line with expectations. Composite ratings are the lowest of the crop cycle while just below the historical average. Ratings improved in only 5 states, declined in 12 while holding steady in 1. 91% of the crop is setting pods vs. YA and 5-year Ave. of 88%. 6% of the crop is dropping leaves, in line with YA and the 5-year Ave.
WHEAT
Prices surged from $.27 to the daily limit of $.45 in nearby CGO futures. Synthetically I had CGO Dec-26 trading $.01-$.02 above limit near today’s close. New contract highs for CGO and KC futures. Both spot CGO and KC also traded to 3-year highs on the weekly chart with next resistance $7.77 ¼ for CGO and $8.58 for KC. Repairs to grain infrastructure at Russia’s port of Novorossiysk could take between 1 to 4 months while Russia also considers pausing their grain export duty. Up to 70 vessels are waiting near the Danube’s Sulina Canal for access to Ukrainian ports to load grain for export. Bottlenecks will likely continue to build with only 5-7 vessels moving through per day. Meanwhile drought conditions in Ukraine threaten to delay and/or reduce winter wheat plantings for the 2027 harvest. Logistical issues could start turning into supply issues. Russia is considering stepping up their missile strikes on Kyiv as peace talks are at a standstill. Egypt, the world’s largest wheat importer who typically imports 80% of their wheat from Russia/Ukraine has reportedly bought 2 cargoes of wheat from France. EU soft wheat exports as of Aug. 23rd at 2.38 mmt are down 33% YOY. Sudan has also reportedly bought a cargo of wheat from France, their first in 18 years. Exports are expected to range from 8-20 mil. bu.
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