Written Commentary
SOYBEANS
The soybean complex was mixed with beans $.04-$.07 lower, meal was down $5-$6, while oil was 100 – 130 higher. Dec-23 meal surged to a new contract high overnight. This rally stalled at the 50 and 100 week MA’s that converge near $439. The next resistance is the summer high at $472.50. Spot board crush margins gained another $.10 today to $2.34 ½ bu., a 7 week high. Soybean meal product value slipped nearly 1% to 62%. The Rosario Board of Trade acknowledged rains this past weekend, along with forecasts for more, greatly alleviated concern for the upcoming Argentine soybean planting season. Much more is needed however to restore soil moisture after 2 years of drought. Southern Brazil remains in an excessively wet pattern with another round of heavy rains forecast this for weekend into early next week with localized flooding possible. Scattered rains remain possible for WC Brazil into early next week as temperatures remain well above normal with the outlook for early November looking less certain. Following yesterday’s ceremonial signing by Chinese importers to purchase “billions” of US Ag. products the USDA announced the sale of 126k tons (4.6 mil. bu.) of soybeans to China. Gonna need a lot more than that. Conab estimates Brazilian soybean plantings have reached 28% as of Oct. 21st. ANEC forecasts Brazil’s bean exports will reach 6.14 mmt in Oct-23, up 71% from Oct-22 and also a new record high for the month. Meal exports are expected to reach 2 mmt, slightly above the 1.8 mmt from Oct-22. Export sales tomorrow are expected to range from 30 – 60 mil. bu. for soybeans, 250 – 550k tons of meal, and -5 – 7k ton of bean oil.
CORN
Futures were $.03 – $.04 today however rebounded to close at roughly the midpoint of today’s range. Dec-23 held support above the October low at $4.76. Heavy rains with 2-4” totals fell in the past 24 hours across SE KS into WC MO, as well as Southern MN into Northern WI and the UP of MI. The central Midwest is expected to remain in an active pattern thru the weekend, delaying the remaining harvest in these areas. There were no export sales announced today. Ukraine’s corn exports since July have reached 3.49 mmt. Total grain exports have reached only 8.56 mmt, down 31% from YA. ANEC forecasts Brazil’s corn exports will reach 8.24 mmt in Oct-23, up 33% from Oct-22 and a new record high for the month. The USDA’s FAS office in Kiev forecasts Ukraine’s 2023 corn production at 30.7 mmt, well above the official USDA est. of 28 mmt providing further US competition in the global marketplace. US ethanol production rebounded to 1,040 tbd last week, slightly above the 1,035 tbd pace from the previous week. 104 mil. bu. of corn was used in the production process, above the pace needed to reach the USDA usage forecast of 5.30 bil. bu. Ethanol stocks rose .3 mil. barrels to 21.4 mb, still below the 22.3 mb from YA. US gasoline demand fell 1% LW to 8.86 mil. barrels per day, which was also down 1% from same week YA. Export sales tomorrow are expected to range from 25 – 50 mil. bu.
WHEAT
Prices were lower across all 3 classes today with MGEX down $.06 – $.08, while KC and Chicago were $.10 – $.14 lower. Dec-23 KC fell to its lowest level since Aug-2021, closing just under $6.50. Still no sign of addition Chinese interest in US SRW wheat. Ukraine’s wheat exports have reached 4.28 mmt since July, no YOY comparisons were available. Russia’s Ag. Ministry expects their country will harvest 140 mmt of grain this year, including 93 mmt of wheat. Their wheat forecast is well above the USDA est. of 85 mmt. SovEcon expects Russian wheat exports in Oct-23 will reach only 1.6 mmt, the lowest since June. As the Kremlin has attempted to create a $270/mt floor in price, their wheat has become less competitive in the global marketplace. Export sales tomorrow are expected to range from 14 – 28 mil. bu.
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