Written Commentary
CORN
Prices were $.04-$.05 higher today as spreads also firmed up. Dec-24 had an outside day up while also closing back above its 50 day MA. Next resistance is the 100 day MA at $4.19. Warm/dry conditions for much of the nation’s midsection continues to allow corn and soybean harvest to move swiftly. Last week money managers sold just over 63k contracts of corn extending their short position to 87k contracts. Index funds were also net sellers of nearly 33k contracts. Export inspections at 39 mil. bu. were in line with expectations however below the 47 mil. bu. needed to reach the USDA forecast of 2.325 bil. bu. YTD inspections at 228 mil. are up 31% from YA vs. the USDA forecast of up 1.5%. Noted takers were Mexico – 22 mil. and Columbia 5 mil. The USDA also announced the sales of 170k mt to Mexico, 198k to unknown and another 130k mt to South Korea, in total nearly 20 mil. bu. AgRural estimates Brazil’s 1st corn crop plantings have reached 48% up from 41% LW and the YA pace of 46%.
SOYBEANS
Prices were higher across the complex with beans up $.05-$.11 with spreads firming, meal was $1-$3 better while oil was up 50 points. A 25 basis point cut to key lending rates in China also helped support prices. Nov-24 beans held support just above LW’s low at $9.68 ½ with next support at the contract low at $9.55. Dec-24 meal ran into resistance at its 50 day MA currently $319.20. Dec-24 oil seems trapped between its 100 day MA resistance at 42.68 and the 50 day MA support at 41.28. Rains have begun to fill in over key agricultural areas of Brazil and Argentina. Forecasts moving forward in SA are also favorable for planting and crop development as most areas expect a good mix of rain and sunshine into early November. Last week MM’s sold nearly 41k contracts of meal, 18.5k contracts of beans and 5.6k contracts of oil. MM’s remain net short soybean while being long both products. Export inspections at 89 mil. bu. were in line with expectations however a new MY high. Last week’s inspections were revised up by 12 mil. bu. bringing YTD inspections to 290 mil. still down 3% from YA vs. the USDA forecast of up 9%. China took 62 mil. bu. The USDA also announced the sale of 380k mt (14 mil. bu.) to unknown buyers. AgRural estimates Brazil’s soybean crop is 18% planted, up from 8% LW however below the 30% pace from YA.
WHEAT
Disappointing close in the wheat market today as prices were mixed, unable to hold early strength. Chicago and MGEX were $.01-$.02 ½ lower while KC was $.01-$.02 higher. Both Chicago and KC were able to hold above LW’s low however Dec-24 MGEX closed into new lows for the month. Some beneficial rains have brought modest drought relief to E. Ukraine and Southern Russia however overall coverage was sporadic. Much more is needed to better establish crops heading into winter, however not much follow up rain is expected over the next week to 10 days. Last week MM’s were net buyers of a couple thousand contracts each in Chicago and MGEX wheat, while being sellers of 604 contracts in KC. Wheat inspections at only 10 mil. bu. were below expectations and below the 14 mil. needed per week to reach the USDA forecast of 825 mil. bu. YTD inspections at 340 mil. are up 34% from YA, vs. the USDA forecast of up 17%. IKAR is reporting Russia’s export price for wheat closed LW at $234/mt FOB, while up $4 for the week it’s still below the Oct. floor price of $240/mt as outlined by Russia’s Grain Exporters Union. This floor is expected to jump to $245 in Nov. and $250/mt in December. SovEcon is reporting Russia’s grain exports reached 1.01 mmt last week, down from 1.28 mmt the previous week. Wheat exports were 940k tons, below the 1.19 mmt the week prior.
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