Written Commentary
MORNING AG OUTLOOK
Mostly higher trade across the Ag space this AM as markets await Chinese leader Xi visit to Washington DC later this week. Bulls remains hopeful China will purchase US corn and wheat as part of their $17 bil. (pro-rated) annual commitment of Ag. purchases outside of the 25 mmt of soybeans. US Treasury Sec. Bessent and USTR Ambassador Greer met with Chinese Vice Premier of State Council this weekend in NY leading up to Trump/Xi meeting late this week. Weekend rains were heavy across the northern and central Midwest slowing crop maturation and delaying harvest activities. Some late weekend rains in the S. plains, otherwise hot/dry in the plains and Delta region with widespread readings of 100+ degrees. Dryer across the Central Midwest and Great Lakes region this week with rains favoring the far western and eastern corn belt. Mostly dry in Brazil and Argentina this weekend while healthy rains in Paraguay. Rains to favor the interior south of Brazil this week while hot/dry elsewhere. Hot and dry in W. Europe while cool in the East with scattered showers. Energy prices are lower after China urged Iran to rein in Houthi rebel attacks on Saudi oil facilities. Nov-26 WTI crude oil is down $2.65 per barrel at $93.45 while RBOB is down $.07 per gallon with HO $.17 lower. The Russia/Ukraine war continues to rage on. The US $$ is slightly lower in 2-sided trade. US stock indices are up .70%-1.0%.
Corn:
Dec-26 futures are up $.07 at $5.34 ½ in 2-sided trade. Prices continue to hold within the range from Fri. Sept. 11th, USDA report day. MM’s bought nearly 2k contracts of corn extending their long position to 427k contracts, just below the record high of 431k. Index funds sold just over 19K. Friday’s COF report showed US feedlots held 11.163 mil. head of cattle as of Sept. 1st, up .7% from YA while slightly below expectations. Placements in Aug-26 were down 9.2% vs. expectations of down only 3.2%. Marketings were down 3.3%. Ukraine’s grain exports since July 1st at 4.67 mmt are down 22% YOY however corn exports at 1.84 mmt are actually nearly double those from YA.
Soybeans:
Nov-26 beans are up $.11 at $13.14 ½ while holding within Friday’s range. Oct-26 meal is $3.40 higher at $358, also holding within Friday’s range. Oct-26 oil is down 16 points at 67.54 trading to a 4-week low overnight. Crush margins are down nearly $.20 at $2.16 ½ bu. MM’s were net buyers of 26k contracts of soybean meal, extending their long positions to new record at nearly 186k. They extended their record net long position across the soybean complex by nearly 14k to 541,150 contracts. Abiove cut their Brazilian export forecast .4 mmt to 115 mmt citing China’s increased interest in US soybeans. Offsetting the lower exports, Abiove raised their crush forecast .3% to 63.5 mmt. Of the 12.14 mmt of soybean imported by China in Aug-26, only 200.5 mt were from the US, while 10.6 mmt were from Brazil. China’s Sinograin is expected to auction off another 543k mt of soybeans out of Govt. storage tomorrow. The trade remains hopeful that US/China will drop reciprocal tariffs this week following the Trump/Xi summit.
Wheat:
Prices range from $.06 to $.10 higher as CGO and MIAX held within Friday’s range. CGO Dec-26 is up $.10 at $7.24, KC Dec-26 is $.09 higher at $7.93, while Dec-26 MIAX is $.05 ½ higher at $7.47. MM’s were net sellers of nearly 15k contracts across the 3 classes, reducing their net long position to 63K contracts. Russian and Ukrainian forces continue military strikes on port infrastructure and cargo vessels with no end in sight. Ukraine’s wheat shipments since July 1st at 2.33 mmt are down 44% YOY. As interior prices in both Russia and Ukraine have plunged, look for farmers in both countries to significantly cut back on winter plantings. Pakistan purchased 365k mt of wheat in last week’s 750k mt tender. The reported price was just under $349/mt CF after Pakistan asked participants to lower their offers to match the lowest one. They issued another tender for 185k mt that closes on Sept. 28th.
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