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China Buys, Soybeans Jump Up Friday

Corn is not following the soybean market.

DES MOINES, Iowa --  On Friday, the CME Group’s soybean and wheat markets caught bids.

At the close, the Dec. corn futures closed ¾¢ lower at $3.89. March corn futures finished ¼¢ lower at $3.98¼.
 
Jan. soybean futures closed 4½¢ higher at $9.36¾. March soybean futures finished 4¢ higher at $9.49¾.

Dec. wheat futures ended 7½¢ higher at $5.16.

December soymeal futures closed $0.50 per short ton lower at $303.90. December soy oil futures closed 0.28¢ higher at 31.03¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.89 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 301 points higher.

On Friday, private exporters reported to the USDA export sales of 132,000 metric tons of soybeans for delivery to China during the 2019/2020 marketing year.
 
The marketing year for soybeans began September 1.

Al Kluis, Kluis Advisors, says trade news and harvest progress dominate the minds of investors.
 
“Weekly export sales were yet again disappointing for corn, and soybean export sales were within expectations. The grain market shrugged off early weakness in the session on Thursday to close a little higher in the soybeans and wheat and a fraction lower in corn. We continue to find support on breaks, but our upside is limited with some harvest hedge pressure,” Kluis told customers in a daily note.

Kluis added, “Some of the recent pressure on soybeans was because the November soybeans were heading into delivery. Now that we have First Notice behind us, the soybean market could push a little higher.”

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Thursday’s Grain Market Review

On Thursday, the CME Group’s farm markets closed mixed, with little help from the weekly export sales and trade news.

At the close, December corn futures finished ¾¢ lower at $3.90; March corn futures ended ¾¢ lower at $3.98¼.
 
November soybean futures settled ¾¢ higher at $9.16¾; January soybean futures ended 1¾¢ higher at $9.32¼.

December wheat futures closed ½¢ lower at $5.08¾.

December soy meal futures closed $2.20 per short ton higher at $304.40. December soy oil futures settled 0.23¢ lower at 30.75¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.01 per barrel lower, the U.S. dollar is higher, and the Dow Jones Industrials are 212 points lower.

On Thursday, the USDA’s Weekly Export Sales Report shows strong soybean figures.

  • Corn: 549,100 metric tons (mt) vs. the trade’s expectations of between 300,000 and 800,000 mt
  • Soybeans: 943,600 mt vs. trade’s expectations of 500,000 and 1.1 mmt
  • Wheat: 493,800 mt vs. the trade’s expectations of between 200,000 and 500,000 mt
  • Soybean mea: 179,500 mt vs. the trade’s expectations of 100,000 and 250,000 mt

Al Kluis, Kluis Advisors, says trade news and harvest progress dominate the minds of investors.
 
“Chile announced it has canceled the APEC summit for November 17 in light of protests and riots. This throws into the air now when the U.S. and China will sign Stage 1 of the long-term trade deal. This is just more news that will keep the grain markets drifting sideways as we head into the USDA Crop Production Report next Friday November 8,” Kluis told customers in a daily note.

Kluis added, “I think the basis levels on soybeans will start to firm up here, as soybean harvest is on the last leg. With the smaller crop, along with more farm storage due to the prevent-plant acres, the commercials did not get the bushels bought they had hoped.”

 

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Wednesday’s Grain Market Review

On Wednesday, the CME Group’s farm markets have little direction.

At the close, December corn futures finished 4¾¢ higher at $3.90¾; March corn futures finished 3½¢ higher at $3.99.
 
November soybean futures closed 2¼¢ lower at $9.16; January soybean futures settled 3¢ lower at $9.30½.

December wheat futures closed 2¼¢ lower at $5.09¾.

December soy meal futures finished 80¢per short ton lower at $302.20. December soy oil futures closed 0.02¢ lower at 30.98¢ per pound.

In the outside markets, the NYMEX crude oil market is 52¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 25 points higher.

On Wednesday, private exporters reported to the USDA export sales of 132,000 metric tons of soybeans for delivery to unknown destinations during the 2019/2020 marketing year.
 
The marketing year for soybeans began September 1.

Jack Scoville, PRICE Futures Group, says investors remain watchful of the fallout from Chile canceling an international November meeting where the U.S. and China were scheduled to sign a trade agreement.

“Chile cancelling the meetings was a deal, but both sides say the negotiations are going well, and an agreement should be ready for signing at or near the middle of November. But the market did not really react too much. Maybe a little selling in the beans, but that is it,” Scoville says.  

He added, “Corn prices were up as the Midwest harvest weather is not real nice and basis reported higher today. The market wants to know corn yields, while the farmer is harvesting mostly beans, as the corn in many cases is still too wet and the farmer wants to get the beans out before the snow gets bigger, anyway. All in all, a decent day and I think more choppy action is coming,” Scoville says.

Al Kluis, Kluis Advisors, says investors still need something solid to trade in order for the markets to catch fire.
 

“China announced that Phase One of the U.S. and China trade agreement will be signed in Chile on November 17. That helped pop the U.S. grain prices for a very short time on Tuesday. We continue to drift, as the market looks for something to trade on,” Kluis told customers in a daily note.

Kluis added, “Some of the recent pressure on grain prices is due to commercial selling. As the national soybean harvest reached 60% complete, home storage is filling up and starting to head to town.”

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Tuesday’s Grain Markets Review

On Tuesday, the CME Group’s farm markets close mixed.

At the close, December corn futures finished 2¼¢ higher at $3.86¼; March corn futures closed 1½¢ higher at $3.96.
 
November soybean futures ended 2½¢ lower at $9.18¼; January soybean futures settled 2¢ lower at $9.33¼.

December wheat futures settled ¼¢ lower at $5.11½.

December soy meal futures closed $1 per short ton lower at $303.00. December soy oil futures are 0.22¢ higher at 31.00¢ per pound.

In the outside markets, the NYMEX crude oil market is 7¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 20 points higher.

Al Kluis, Kluis Advisors, says investors still need something solid to trade in order for the markets to catch fire.
 
“When will the Trump administration say it will begin taking off tariffs on Chinese products? That would open the door for large Chinese purchases of ag products, especially pork and beans,” Kluis told customers in a daily note.

Kluis added, “The USDA Crop Progress Report next Monday will show corn harvest falling even further behind with the rain and snow that are in the forecast for later this week.”

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Monday’s Grain Market Review

On Monday, the CME Group’s farm markets lean on a slightly stronger soybean complex for strength.

At the close, December corn futures finished 2¢ lower at $3.84; March corn futures finished 3¢ lower at $3.94½.
 
November soybean futures settled ½¢ higher at $9.20½; January soybean futures finished 1¢ higher at $9.35¼.

December wheat futures closed 6¢ lower at $5.11¾.

December soy meal futures finished 70¢ per short ton higher at $304. December soy oil futures closed 0.18¢ lower at 30.78¢ per pound.

In the outside markets, the NYMEX crude oil market is 86¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 136 points higher.

On Monday, private exporters reported to the USDA export sales of 135,000 metric tons of soybean cake and meal for delivery to the Philippines during the 2019/2020 marketing year.
 
The marketing year for soybean cake and meal began October 1.

Britt O’Connell, cash adviser for Commodity Risk Management Group, says soybeans have found themselves caught in a range from $9.20 to $9.40. Opening at the bottom side of the range this morning, beans caught a bid.

“With continued positive dialogue between China and the U.S., regarding ‘Phase 1’ of a trade deal, hope is that Xi and Trump sign a deal on the specifics of that within the next few weeks. Basis on beans continues to remain strong. China was rumored to be shopping purchases out of the Gulf on Thursday. With few offers, basis shot up end of the week. That could give support to futures as well.  

She added, “Many areas of the Midwest have snow in the forecast this week. While it appears that last week we could have seen decent harvest progress – find out this afternoon – if not as expected that could give lift as well.”  

Corn continues to stay rangebound as well. Holding $3.85 is key. If not, a break to $3.80 is likely, she says.  

“It could easily go back to our old range of $3.60 to $3.70,” O’Connell says.

Al Kluis, Kluis Advisors, says the markets are still searching for solid bullish news to trade.
 
“The comments from the U.S./China trade negotiators were bullish one hour and bearish the next. That is also how the grain markets traded,” Kluis told customers in a daily note.

Kluis added, “With rain and snow in the forecast for the next two weeks, it may take until Thanksgiving – even Christmas – to get the last of the U.S. corn and soybean harvested.”

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