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Ag Market View for Oct 7th

SOYBEANS

Soybeans ended higher. Talk that China was bidding for 8 US soybean cargoes offered support. Late bounce in Crude oil prices helped rally soyoil which offered support to soybeans. Soybean futures have been trending lower since the July 10 high near 14.18. New selling appeared after the bearish USDA Sep 30 stocks report and SX dropped below 12.50. SX is back near 12.47 but needs new bullish news to trade higher. Weekly US soybean export sales were 1.04 mt or 38 mil bu. Shipments to date are only 73 mil bu vs 241 last year. Total commit is near 930 mil bu vs 1,489 last year. USDA goal is 2,090 with some looking for exports to drop to 2,000. Key will be China demand and Brazil 2022 crop size. Conab est Brazil 2022 crop at 143 mmt vs 136 last year. Next week USDA will increase US 2021/22 carryin, increase US 2021 crop and raise US 2021/22 soybean carryout to closer to 300 mil bu.

CORN

Corn futures managed small gains after Crude oil managed to turn higher on the day. CZ has been trading most sideways since June between 5.00 and 5.50.There were a few peaks near 6.00 after bullish USDA reports. Currently CZ is in a range between 20 day moving average support near 5.16 and 100 day moving average resistance near 5.48. Open interest is the lowest since 2017. Oat market made new highs near 6.22 on lower Canada supplies for export to US. OZ minus CZ spread is a record high 89 cents. Corn futures have equal support due to talk of lower US harvest corn yields and lack of new US farmer selling. There is also support from dry weather in Brazil and Argentina. Matif corn futures are trading higher due to slow EU harvest and lower corn imports. Weekly US corn export sales were 1.27 mmt or 50 mil bu. Shipments to date are only 98 mil bu vs 145 last year. Total export commit is near 1,046 mil bu vs 1,017 last year. USDA goal is 2,475 with some looking for exports to reach 2,700. Central Brazil and Argentina are dry. Dry weather to date could reduce 1st season Brazil corn acres but could increase 2nd crop acres. This could delay Brazil corn harvest and help US exports.

WHEAT

Wheat futures ended mixed. There was a wave of selling mid session on fears of lower global economies and chart basis selling. Weekly US wheat export sales continued to be slower than needed to equal USDA goal. Some feel that next week, USDA should drop US 2021 all wheat crop. They could also raise domestic demand. Some could see final US 2021/22 wheat carryout closer to 520 mil bu vs USDA 615. USDA could also estimate World wheat exporters stocks to use ratio record low. Matif wheat futures are making new highs on talk of lower EU exports. There are also reports that Russia could go to a wheat export quota in January. Drop in US, Canada, EU and Russia supplies continues to offer support to futures. Talk that Argentina may ban wheat exports is also supportive. Weekly US wheat export sales were 333 mt or 12 mil bu. Total commit is near 419 mil bu vs 533 ly. MWZ made new highs. WZ is down for the third day and near 7.41 vs recent high near 7.63.

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