Written Commentary
CORN
Prices were $.02 lower in choppy 2 sided trade. Spreads were unchanged. Near term resistance for Dec-25 is at LW’s high of $4.31 ¼ with support at the 50 day MA at $4.14 ¾. The USDA announced the sale of 313k mt (12.4 mil. bu.) of corn to Mexico. Ethanol production slipped to 1,024 tbd, or 301 mil. gallons in the week ended Fri. Sept. 19th, down from 310 mil. the previous week however up 3% from YA. Production was below expectations and the lowest in 19 weeks. There was 102 mil. bu. of corn used in the production process, or 14.6 mil. bu. per day, well below the 15.34 mbd needed to reach the USDA 25/26 corn usage forecast of 5.60 bil. bu. Ethanol stocks jumped to 23.5 mil. barrels, above expectations but in line with YA. While implied gasoline usage rose 1.7% last week to 8.959 mbd, it was down 2.7% YOY.
SOYBEANS
Prices were lower across the complex however very little changed. Beans were $.02-$.03 lower, meal was off $1-$3 while oil was steady to a few ticks lower. Nearby meal spreads softened with FND against the Oct-25 contracts next Tues. Nov-25 beans held support above yesterday’s low of $10.05, however was not able to hold gains after trading up to $10.20. Higher trade in Oct-25 oil stalled out at $.50 lb. Oct-24 meal has fallen to a 7 week low despite the USDA announcing the sale of 101.4k mt of meal to Guatemala. South Korean millers have also reportedly been active buyers of US and/or SA meal in recent days. Spot board crush margins held steady at $1.47 bu. at a 3 month low. Chinese purchases of Argentine soybeans since suspending their export tax have reached 20-24 cargoes. Total volume at roughly 1.3-1.6 mmt continues to cut into potential US demand. While much of this volume is for Nov-25 shipment, some of these sales are for April-26 shipment with the arrival of their new crop harvest. The tax holiday in Argentina is expected to hold until the end of Oct-25, or when they have reached $7 bil. in export revenues. The bean sales to China were reportedly done at a $2.00 premium to Nov-25 futures, including cost and freight, while generating close to $2 bil. in revenue. Timely rains in Argentina and S. Brazil are favorable for wheat development. Better prospects for rain is expected for Brazil’s center west and center south crop areas this weekend and next week as they slowly transition into their monsoonal season. Export sales tomorrow are expected to range from 25-55 mil. bu. of soybeans, 150-400k tons of meal and -5 – 25k tons of oil. Expect sale to China to remain at zero.
WHEAT
Prices ranged from $.01-$.05 lower across the 3 classes today. Chicago was the upside leader however all the Dec-25 contracts traded to a new high for the week in early trade. In the US as the current rain event pushes off to the east, a warmer and dryer pattern looks to set up across much of the nation’s midsection which should provide better harvest conditions for corn and soybeans while also allowing better opportunities for winter wheat plantings. South Korea reportedly bought 50k mt of US milling wheat. About half of the volume was white wheat, with 12.2k mt of HRW and 12.3k mt of durum. Volume estimates for Algeria’s recent wheat purchase range from 500k to nearly 700k mt. Shipment is expected in November with the Ave. price hovering around $260/mt CF.The USDA has lowered WW production in the September report 7 of the last 8 years. Tomorrow’s export sales are expected to range from 12-24 mil. bu.
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