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Soybean Prices Finish 4¢ Higher Friday

Bulls need fresh trading news.

DES MOINES, Iowa -- On Friday, the CME Group’s farm markets rely on the soybean complex for momentum.

At the close, the Dec. corn futures finished 4¢ lower at $3.84¾. March corn futures ended 3¾¢ lower at $3.97.
 
Nov. soybean futures closed 4½¢ higher at $9.16¾. Jan. soybean futures are 4¼¢ higher at $9.30¼.

Dec. wheat futures ended 1¾¢ higher at $4.90.

December soymeal futures closed $0.80 per short ton higher at $303.70. December soy oil futures ended 0.03¢ lower at 29.86¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.32 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 296 points higher.

Al Kluis, Kluis Advisors, says soybeans had a really good week of exports (mainly to China), but that was already priced into the market.
 
“Corn exports continue to struggle as does the whole demand scenario for corn. A smaller crop will be somewhat offset by smaller demand. Grain prices seem to be settling into a sideways trading range until we get more harvest complete. Then we can gauge the size of this year’s corn and soybean crop,” Kluis told customers in a daily note.

Kluis added, “We had another dismal week of export sales for corn. We have booked about half of what we did a year ago. There is a very good chance we will see the USDA decrease its annual corn export projection by 25 to 50 million bushels in next week’s monthly report,” Kluis stated.

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Thursday’s Grain Market Review

On Thursday, the CME Group’s farm markets chop around.

At the close, December corn futures finished 1¢ higher at $3.88¾; March corn futures closed 1¢ higher at $4.00¾.
 
November soybean futures settled 2¢ lower at $9.11¾; January soybean futures settled 1¾¢ lower at $9.26.

December wheat futures closed ¼¢ lower at $4.88½.

December soy meal futures ended $2.70 per short ton lower at $302.90. December soy oil futures closed 0.68¢ higher at 29.89¢ per pound.

In the outside markets, the NYMEX crude oil market is 12¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 100 points higher.

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

  • Export sales of 252,000 metric tons of soybeans for delivery to China during the 2019/2020 marketing year. 
  • Export sales of 130,000 metric tons of white wheat for delivery to China during the 2019/2020 marketing year.

The marketing year for wheat began June 1 and soybeans began September 1.

Separately, on Thursday, the USDA’s Weekly Export Sales Report shows very strong soybean figures. Most of the sales were from China.

Corn: 565,100 metric tons vs. the trade’s expectations of between 400,000 and 850,000 mmt

Soybeans: 2.076 mmt vs. the trade’s expectations of between 800,000 and 1,500,000 mmt

Wheat: 328,500 mt vs. the trade’s expectations of between 200,000 and 600,000 mt

Soybean meal: 2,500 mt vs. the trade’s expectations of between 100,000 and 400,000 mt

Britt O’Connell, cash adviser for Commodity Risk Management Group, says that the corn and soybean markets both seem to be struggling to find further reason to move beyond the technical resistance that lies just above each of those markets.

“Without something – yield data, positive news regarding trade, etc., we may be stuck in a very sideways trading pattern. A continuing wet pattern over the Corn Belt has halted significant harvest. Therefore, sample size on yield data is yet too small,” O’Connell says.  

O’Connell added, “A breakout in corn beyond $4 could invite further buying and a move toward the 62% retracement levels of $4.27 per bushel. Beans will likely experience technical resistance every 20¢ ($9.20, $9.40, $9.60) with $9.60 being the top end of the market since the start of the trade war.”

Al Kluis, Kluis Advisors, says investors really want to see more harvest yields.
 
“Harvest continues to inch forward. Heavy rain continues in the north-central Corn Belt. U.S. grain prices are choppy, as we patiently await more yield results. What will be the real size of this year’s crop? It really feels like the lows are in for the year. The size of the crop will determine just how high we can rally,” Kluis told customers in a daily note.

Kluis added, “The corn and soybean yields coming in, so far, show that corn yields are holding up near USDA estimates, but the soybean yields are a little disappointing,” Kluis stated.

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Wednesday’s Grain Markets Review

On Wednesday, the CME Group’s farm markets lack buyers.

At the close, December corn futures closed 4¾¢ lower at $3.87¼; March corn futures finished 4¼¢ lower at $3.99¾.
 
November soybean futures closed 6¾¢ lower at $9.12¼; January soybean futures ended 4¼¢ lower at $9.27.

December wheat futures finished 9¾¢ lower at $4.88½.

December soy meal futures closed $3.40 per short ton lower at $305.60. December soy oil futures settled 0.33¢ higher at 29.21¢ per pound.

In the outside markets, the NYMEX crude oil market is 88¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 477 points lower.

On Wednesday, private exporters reported to the USDA export sales of 464,000 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 the markets could face a sell-off.
 
“The technical picture favors the bulls for both corn and soybeans as prices are now at multiweek highs. Fund managers who are still short the grains are likely getting nervous after this recent rally. However, daily momentum indicators quickly pushed into overbought territory, suggesting we are due for a setback,” Kluis told customers in a daily note.

Kluis added, “The two-week forecast for South America would provide some much-needed moisture. The planting pace should pick up quickly if the rain comes as forecast,” Kluis stated.

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Tuesday’s Grain Market Review

On Tuesday, the CME Group’s soybean market adds 36¢ in two sessions, while corn adds 20¢.

At the close, December corn futures finished 4¼¢ higher at $3.92¼; March corn futures closed 5¢ higher at $4.04½.
 
November soybean futures settled 13½¢ higher at $9.19; January soybean futures finished 13¢ higher at $9.32¾.

December wheat futures ended 3¢ higher at $4.98¾.

December soy meal futures closed $8 per short ton higher at $309.00. December soy oil futures closed 0.20¢ lower at 28.88¢ per pound.

In the outside markets, the NYMEX crude oil market is 40¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 288 points lower.

Al Kluis, Kluis Advisors, says yesterday’s bullish USDA Quarterly Grains Stocks Report has a long tail.
 
“The Quarterly Grain Stocks Report stated corn stocks were 314 million bushels lower than prereport estimates. That is the third-largest bullish adjustment (on a percentage basis) going back to December 1983. The soybean stocks number was 69 million bushels less than prereport estimates. This news sent corn prices to the highest level since August 13. Meanwhile, soybean prices hit levels last seen on July 29,” Kluis told customers in a daily note.

Kluis added, “The funds are now more likely to reduce the large short position they have in corn and soybeans. With the new data, prices will be more sensitive to poor yield reports. The bullish what-if scenarios just got a little easier to justify,” Kluis stated.

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Monday’s Grain Market Review

On Monday, investors bought the CME Group’s soybean market.

The USDA released a bullish report for corn and soybean prices.

At the close, December corn futures finished 16½¢ higher at $3.88; March corn futures ended 15¾¢ higher at $3.99½.
 
November soybean futures settled 23¢ higher at $9.06; January soybean futures closed 22¢ higher at $9.19¼.

December wheat futures closed 8½¢ higher at $4.95¾.

December soy meal futures closed $5.90 per short ton higher at $301. December soy oil futures finished 0.24¢ higher at 29.08¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.38 per barrel lower, the U.S. dollar is higher, and the Dow Jones Industrials are 156 points higher.

On Monday, private exporters reported to the USDA export sales of 120,000 metric tons of corn for delivery to Mexico during the 2019/2020 marketing year.

The marketing year for corn began September 1.

Al Kluis, Kluis Advisors, says all attention today is on the USDA Grain Stocks Report to be released at 11 a.m CDT.
 
“The USDA report today may be negative for corn. The USDA has consistently overstated feed usage in the last several years. On the bullish side, I think last year’s soybean crop may have been overstated, as well. That will take ending stocks lower than expected. However, I also know it is dangerous to make predictions about the USDA Grain Stocks Report in the hours before the report,” Kluis told customers in a daily note.

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