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Soybeans Close Up 4¢ Friday

This week’s strong export sales have been mostly ignored.

DES MOINES, Iowa -- On Friday, the CME Group’s soybean market finally benefitted from strong demand, as it ended the week’s trade higher.

At the close, the December corn futures finished 1¾¢ lower at $3.48¾. March futures settled 2¢ lower at $3.62½.

November soybean futures closed 4¢ higher at $9.75¼. January soybean futures ended 4¢ higher at $9.86½.

December wheat futures closed 4½¢ lower at $4.27¼.

December soy meal futures closed unchanged at $312.10. December soy oil futures finished 0.34¢ higher at 34.84¢ per pound. 

In the outside markets, the Brent crude oil market is $1.26 higher, the U.S. dollar is higher, and the Dow Jones Industrials are 38 points higher.

Cory Bratland, Kluis Commodities broker, says investors haven’t found what they are looking for.

“Even after another very solid week of weekly export sales for both corn and soybeans, we still have the daunting task of achieving what the USDA has projected. We could easily see some reduction in export demand in future crop production reports,” Bratland stated in a note to customers Friday.  

The Commitments of Traders Report will be out at 2 p.m. today.

“Will the funds push their net-short position to 200,000 contracts short for corn? If so, then this isn’t a long-term bearish factor,” Bratland stated in the daily newsletter. 

On Friday, the USDA announced fresh export sales. Private exporters reported to the U.S. Department of Agriculture the following activity:

  • Export sales of 238,000 metric tons of soybeans for delivery to China during the 2017/2018 marketing year.
  • Export sales of 132,000 metric tons of corn for delivery to Spain during the 2017/2018 marketing year.

The marketing year for corn and soybeans began September 1.

 

 

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Thursday’s Grain Market Review

On Thursday, the CME Group’s soybean and wheat markets ended the day lower than where they started, while the corn market didn’t move much at all.

At the close, the December corn futures finished ½¢ lower at $3.50. March futures ended ¾¢ lower at $3.64.

November soybean futures closed 4¼ lower at $9.71¼; January soybean futures settled 3¾¢ lower at $9.82½.

December wheat futures ended 3¾¢ lower at $4.31.

December soy meal futures finished $3.30 per short ton lower at $312.10. December soy oil futures closed 0.24¢ higher at 34.50¢ per pound. 

In the outside markets, the Brent crude oil market is 36¢ higher, the U.S. dollar is higher, and the Dow Jones Industrials are 94 points higher.

Jason Ward, Northstar Commodity Investment’s director of grains and energy, says the market didn’t use the strong export sales to its advantage today.

“Lately, we have had some investors sell their short positions, creating a little higher trade. But today’s impressive corn and soybean exports weren’t good enough to move the needle. Plus, South America’s soybean planting weather is bearish,” Ward says.

The USDA Weekly Export Sales Report Thursday showed that soybean sales beat expectations, corn sales came in at the high end, and wheat was within.

  • Corn: 1.384 million metric tons vs. the trade’s expectations of between 800,000 and 1,400,000 mt
  • Soybeans: 2.129 million mt vs. the trade’s expectations of between 1,200,000 and 1,800,000 mt
  • Soybean meal: 142,800 mt vs. the trade’s expectations of between 150,000 and 250,000 mt      
  • Wheat: 90,600 mt vs. the trade’s expectations of between 300,000 and 500,000 mt 

 

 

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Wednesday’s Grain Market

On Wednesday, the farm markets have backed off their daily highs, with corn and wheat even turning lower.

At the close, the December corn futures finished 1¾¢ lower at $3.51. March futures settled 1½¢ lower at $3.65¼.

November soybean futures ended unchanged at $9.75½; January soybean futures closed ½¢ higher at $9.86¼.

December wheat futures finished 2½¢ lower at $4.35.

December soy meal futures settled $1.20 per short ton higher at $315.40. December soy oil futures closed 0.08¢ lower at 34.26¢ per pound. 

In the outside markets, the Brent crude oil market is 34¢ lower, the U.S. dollar is lower, and the Dow Jones Industrials are 129 points lower.

Bob Linneman, Kluis Commodities broker, says grain market bulls are trying to push prices higher, though harvesttime is a challenging period to do so.

“Corn and wheat prices are approaching multiweek highs. They have not broken out to new highs, but the way prices react over the next 10¢ will be very important. Corn and soybean basis is unlikely to improve over the short term if prices continue to move higher. It is early in the export year, but weekly exports sales are well behind the USDA pace for new crop. This is worth watching to see if the trend continues,” Linneman stated in a daily note to customers.

 

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Tuesday’s Grain Market Review

On Tuesday, the CME Group’s farm markets finished mixed, as the corn complex found a few buyers.

At the close, the December corn futures settled 1½¢ higher at $3.52¾. March futures finished 1½¢ higher at $3.66¾.

November soybean futures closed 5¼¢ lower at $9.75; January soybean futures closed 5¼¢ lower at $9.85¾.

December wheat futures finished 1½¢ higher at $4.38.

December soy meal futures closed $1.70 per short ton lower at $314.20. December soy oil futures closed 0.29¢ lower at 34.34¢ per pound. 

In the outside markets, the Brent crude oil market is 54¢ higher, the U.S. dollar is lower, and the Dow Jones Industrials are 179 points higher.

Jack Scoville, The PRICE Futures Group senior market analyst, says that Turnaround Tuesday is happening today. 

“There’s no real interest in owning or selling yet, so yesterday was up, and today we’re down,” Scoville says. 

Farmers are keeping an eye on things but not really selling, Scoville says. “Many in the western Corn Belt and central Corn Belt areas have too wet of harvest conditions,” Scoville says. 

He adds, “Meanwhile, Brazil weather is expected to finally start to improve starting in a week. All in all, I do not view this selling as bad. I thought yesterday was a pretty significant move for corn and wheat more than beans, and, so far, the markets are holding pretty well.”

Al Kluis, Kluis Commodities, told customers in a daily newsletter that Monday’s USDA Crop Progress Report indicated a stretched-out corn harvest, but basis bids are getting favorable for farmers.

“The report shows corn harvest 38% complete (vs. 59% five-year average) and soybean harvest at 70% complete (down 3% from the five-year average). By next week, soybean harvest will be close to 90% complete, and corn harvest will advance beyond 50% complete. The harvest will continue into November. However, basis bids are improving in the eastern Corn Belt now. That will spread to the central and northern Corn Belt by next week,” Kluis stated.

 

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Monday’s Grain Market Review

Corn and soybean futures finished higher as investors provided the support by selling out of some of their short positions.

The December corn futures finished 6¾¢ higher at $3.51. March futures finished 6¾¢ higher at $3.65.

November soybean futures settled 2¢ higher at $9.80; January soybean futures closed 2¢ higher at $9.80.

December wheat futures closed 10¾¢ higher at $4.36¾.

December soy meal futures closed $1.20 per short ton lower at $315.90. December soy oil futures closed 0.47¢ higher at 34.63¢ per pound. 

In the outside markets, the Brent crude oil market is 16¢ higher, the U.S. dollar is higher, and the Dow Jones Industrials are 4 points lower.

About 28% of the U.S. corn crop was harvested as of last week, well behind the five-year average pace of 47%, the USDA said. Soybeans were 49% harvested, behind the average of 60% for this time of year.

The USDA will update crop progress in a report this afternoon. While a large portion of the Midwest was dry last week, rainfall during the weekend again slowed collection of crops.

Still, yields have been reportedly strong in several states including Iowa, the biggest producer of both corn and soybeans. That’s kept a lid on prices and, going forward, analysts don’t expect much of an extension either way out of the current range.

Money managers extended bearish bets on corn while pushing net-long positions in soybeans last week.

“We are in the middle of harvest and there is no incentive for funds to cover shorts leaving the market vulnerable to more selling,” said Tomm Pfitzenmaier, the president of Summit Commodity Brokerage in Des Moines, Iowa. “Selling has been working for those playing the short side of the market, and there is not much in the news to prompt them to either cover shorts or quit selling.”

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