Written Commentary
CORN
Prices were $.01-$.02 lower with spreads also weakening. Dec-24 was stuck between its 50 day MA support at $4.10 ½ and 100 day MA resistance at $4.15 ½. The US will see cumulative rainfall of 2-5” over a wide band stretching from Oklahoma northeast thru the Great Lakes region over the next week. Although the last 10% of corn harvest may be delayed, the moisture will help ease expanded drought readings and give interior river systems a boost. The USDA announced the sale of 273k mt (10.8 mil. bu.) to an unknown buyer. Ethanol production ticked up to 1,082 tbd LW, up from 1,081 tbd the previous week and up 3% from YA. Production was in line with expectations and a new MY high. There was 108.8 mil. bu. of corn used, or 15.5 mil. bu. per day, well above the 14.91 mbd needed to reach the USDA forecast of 5.450 bil. Ethanol stocks fell to an 11 month low at 21.8 mil. barrel, well below expectations. Implied gasoline usage rose 3.6% to 9.159 mil. barrels per day, and is up 5.3% YOY. A 24 hour labor strike at the Rosario Grain port is preventing vessels from entering or leaving the Argentine port. Export sales tomorrow are expected to range from 70-135 mil. bu. Look for Dec-24 to stay range bound between $3.95-$4.25 until next Fri. USDA production and WASDE data.
SOYBEANS
Prices were mixed with beans up $.10-$.12, meal was steady to slightly lower while bean oil was up 90-100. Bean spreads plunged ahead of FND for Nov-24, however did recover late. Deliveries are expected to be lite as the CME reports registrations unchanged at 155 contracts. Oil spreads firmed a bit while meal spreads softened. Jan-25 beans made a fresh 2 month low overnight, however held support above its contract low at $9.73 ½ before recovering. Next resistance is LW’s high at $10.18. Dec-24 meal also reached a fresh 2 month low however also held support above its contract low at $298.50. Dec-24 oil is building support above its 100 day MA at 42.59, next resistance is LW’s high at 45.10. Spot board crush margins were little changed at $1.69 bu., however bean oil PV increased to 42.1% a 7 month high. Global forecasts remain favorable for crop development, little changed from yesterday. Central growing regions of Brazil will see a good mix of rain and sunshine over the next few weeks keeping production prospects high. A few more days of net drying in Southern Brazil, favorable for wheat harvest and summer plantings, before scattered showers return this weekend and late next week. Argentina is also expecting a mix of rain and sunshine over the next few weeks. The USDA announced the sales of 132k mt (4.8 mil. bu.) to both China and an unknown buyer. China’s Ag. Ministry indicates they are willing to deepen cooperation with Russia’s soybean industry. Despite tripling their soybean production over the past decade, this year’s record bean crop in Russia totaled only 7.3 mmt. Chinese production the past 3 years has ranged between 20-21 mmt yet their annual consumption is above 120 mmt. Russia isn’t likely to put much of a dent in China’s bean imports from Brazil/US anytime soon. Export sales tomorrow are expected to range from 55-100 mil. bu. for beans, 100-350k tons of meal and 5-25k tons of bean oil.
WHEAT
Prices were $.01-$.03 higher in two-sided trade across all three classes. The rebound in Dec-24 Chicago stalled very near its 100-day MA at $5.79 ½. Dec-24 KC stalled between its 50 and 100 day MA resistance before pulling back. Some rain is expected for E. Ukraine, S. Russia and W. Kazakhstan in the near term, however a net drying pattern remains intact. Despite Russian exports expected to reach a record of 5.9 mmt in Oct-24, SovEcon lowered their 24/25 Russian wheat export forecast 1.7 mmt to 45.9 mmt citing their Ag. Ministry intervention into global markets. If realized this would be their lowest export figure in 3 years. The USDA’s Russian export forecast remained at 48 mmt in the Oct-24 WASDE report. Algeria is seeking 50k mt of optional origin soft milling wheat in a tender that closes tomorrow. While much of KS is expecting heavy rains over the next 7 days, western areas of the state along with the panhandles of OK and TX will likely miss out. US exports tomorrow are expected to range from 10 – 20 mil. bu.
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