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Corn, Soybeans Close Double-Digits Higher Thursday

End-of-month buying sets in Thursday.

DES MOINES, Iowa -- On the last trading day of the month, the buyers have stepped in to help the CME Group’s farm markets close stronger.

At the close, the December corn futures finished 12¼¢ higher at $3.57¾, while March futures finished 12¼¢ higher at $3.70½.

November soybean futures finished 12¢ higher at $9.45¼, January soybean futures finished 12¢ higher $9.54¾.

September wheat futures ended 4¾¢ higher at $4.34½.

December soy meal futures closed $2.10 per short ton higher at $299.50. December soy oil futures settled 0.37¢ higher at 35.06¢ per pound. 

In the outside markets, the Brent crude oil market is $1.24 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 45 points higher.

Deanna Hawthorne-Lahre, StatFutures cofounder and trader, says today’s rally is sparked by seasonal patterns.

“This is a seasonal and classic bounce for the end of August. The ruthless break in corn with heavy liquidation of open interest has this market cleaned up and ready to find some levels that appear better at the moment, but we still sit a month away from the gut slot,” Hawthorne-Lahre says.

She adds, “Heavy deliveries in the Minneapolis wheat market signal the final throwing of the sink at this thing and shows that we can let up on this sell-off thing and trade a bit.”

China is buying into the soybean market at the $9.50-per-bushel price level, she says.

“Which makes sense against what it’s done the past couple of crops. Overall, the market seems friendly, but not getting carried away, as this is more of a pressure release than a V-shape bounce,” Hawthorne-Lahre says.

The USDA’s Weekly Export Sales Report Thursday shows strong soybean demand.

  • Wheat = 566,000 metric tons vs. the trade’s expectations of between 300,000 and 600,000 mt.
  • Corn = 992,600 mt. vs. the trade’s expectations of between 450,000 and 1,000,000 mt.
  • Soybeans = 1.682 million mt. vs. the trade’s expectations of between 650,000 and 1,500,000 mt.
  • Soybean meal = 420,600 mt. vs. the trade’s expectations of between 100,000 and 250,000 mt. 

Separately on Thursday, the USDA announced fresh soybean demand from China.

Private exporters reported to the U.S. Department of Agriculture export sales of 132,000 metric tons of soybeans for delivery to unknown destinations during the 2017-2018 marketing year.

The marketing year for soybeans began September 1.

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Wednesday’s Grain Market Review

On Wednesday, the CME Group’s farm markets finish lower, as the market bulls seem nonexistent.

At the close, the September corn futures finished 4¢ lower at $3.29½, while December futures finished 3¼¢ lower at $3.45½.

November soybean futures closed 4¢ lower at $9.33¼; January soybean futures are 3¾¢ lower $9.42¾.

September wheat futures finished unchanged at $4.29.

December soy meal futures closed $1.80 per short ton lower at $297.40. December soy oil futures finished 0.04¢ higher at 34.69¢ per pound. 

In the outside markets, the Brent crude oil market is 33¢ per barrel lower, the U.S. dollar is higher, and the Dow Jones Industrials are 37 points higher.

Jack Scoville, The PRICE Futures Group’s senior market analyst, says the markets are just drifting lower today.

“There is really no good reason to buy. The latest crop tour really took the air out of the wings of the bulls,” Scoville says. “We have not really paid attention to anything since then –neither the dollar nor the hurricane.”

Scoville adds, “I expect that we are near a bottom for the short term, as we have a three-day weekend coming. I’m not sure how many people want to be hugely short going into the weekend.”

There is some colder air in the forecast for next week, not cold enough to hurt anything but certainly a note of what might be coming, he says. 

“Plus, Harvey now in the Delta and moving to the southeast, less rain and less intense, but still there and maybe some new damage coming. So we might try to grab somewhere along in here,” Scoville says.

Bob Linneman, Kluis Commodities broker, says investors and the market technical factors are in a tug-of-war.

“The technical picture for all grain charts is oversold, but the bulls are reluctant to jump until they get some bullish news,” Linneman stated in a note to customers Wednesday.

He added, “Right now, early frost is the best story the bulls have. It is worth noting that 44% of the corn crop is dented, compared with 57% last year. Is the threat of frost enough to send the shorts running, or will they wait until they can see the damage? Lately, I would have to say the funds are more in line with ‘show me the damage’ before they commit to a position.”

 

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Tuesday’s Grain Market Review

On Tuesday, the CME Group’s farm markets closed mostly lower.

At the close, the September corn futures finished 2½¢ lower at $3.33½, and December futures ended 2¼¢ lower at $3.48¾.

November soybean futures ended 4¢ lower at $9.37¼; January soybean futures settled 3¾¢ lower at $9.46½.

September wheat futures closed 1¾¢ higher at $4.29¾.

December soy meal futures ended 20¢ per short ton lower at $299.20. December soy oil futures finished 0.31¢ lower at 34.65¢ per pound. 

In the outside markets, the Brent crude oil market is 7¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 41 points higher.

On Tuesday, private exporters reported to the USDA the following activity:

  • Export sales of 198,000 metric tons of soybeans for delivery to China during the 2017-2018 marketing year.
  • Export sales of 226,000 metric tons of corn for delivery to Mexico during the 2017-2018 marketing year.

The marketing year for corn and soybeans began September 1.

Brian A. Rydlund, CHS Hedging market analyst, says the corn market is reaching last year’s low.

“As those investors who are short the farm markets get shorter, it appears there is no joy in Mudville,” Rydlund says.

No weather worries pressure the crop prices too, Rydlund says.

“Northern Corn Belt farmers worry about having enough time to finish this crop. So we need time, and we need to avoid an early frost in the Upper Midwest,” Rydlund says.  
 
He adds, “Cash corn is not quite as cheap today in western Minnesota compared with last year at our harvest lows, which was early November. I believe an average cash bid right now is near $2.75 in western Minnesota. So, we’ve been sporting a $2 handle for a little while already.”

 

 

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Monday’s Grain Market Review

On Monday, the CME Group’s farm markets close lower.

At the close, the September corn futures finished 2¾¢ lower at $3.36, and December futures finished 2½¢ lower at $3.51.

November soybean futures settled 3¾¢ lower at $9.35¼; January soybean futures ended 3¼¢ lower at $9.41¼.

September wheat futures ended 7¼¢ lower at $4.28.

December soy meal futures closed 90¢ per short ton lower at $295.50. December soy oil futures closed 0.01¢ higher at 34.96¢ per pound. 

In the outside markets, the Brent crude oil market is $1.30 per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 19 points lower.

Jason Roose, U.S. Commodities, says the grain markets are entering seasonal price patterns.

“There is a seasonal trend to continue lower as harvest progresses north, unless lower yields are seen. Expectations for better crop ratings and light producer selling are adding to the price liquidation in an oversold market,” Roose says.

Al Kluis, Kluis Commodities, says the market is waiting to see how much old-crop corn gets sold.

“Corn prices will struggle this week until all of the delayed price (DP) and September basis contract corn are priced out by Thursday, August 31,” Kluis stated in a daily note to customers.

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