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Soybeans Extend Losses Wednesday

The Dow drops 555 points.

DES MOINES, Iowa -- On Wednesday, the CME Group's farm markets sink.

At the close, the December corn futures finished 1¾¢ lower at $3.62. March futures ended 1¾¢ lower at $3.74¾.

November soybean futures ended 10¾¢ lower at $8.52¼. January soybean futures finished 10¾¢ lower at $8.66.

December wheat futures ended 4½¢ lower at $5.10½.

December soymeal futures closed 2.10¢ per short ton lower at $315.70.

December soy oil futures closed $0.33 lower at 28.93¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.73 lower, the U.S. dollar is lower, and the Dow Jones Industrials are 555 points lower.

Jack Scoville, the PRICE Futures Group’s senior market analyst, says that both ag and outside markets are pressured.

“Interest rates are going up, and that is always a negative impact on the stock market,” Scoville says. Plus, the Trump administration is telling China not to manipulate its currency, as the Renembi has been dropping hard against the U.S. dollar. That creates the threat of even more sanctions and trade war.”

Investors will eye the USDA October Supply/Demand reports tomorrow and the heavy rains delaying harvest.

“But the weather is supposed to get better after this latest round of rain,” Scoville says.

Al Kluis, Kluis Advisors, says that the move downward in the soybean market has found support at the 10-day average.

“Soybean harvest progress was reported at 32% complete vs the five-year average of 36%. Corn harvested was reported at 34% complete vs. the five-year average of 26%. The wet weather has put soybean harvest in Iowa, Michigan, North Dakota, and South Dakota all more than 10 percentage points behind the five-year pace,” Kluis stated in a daily note to customers.

Kluis added, “Harvest pace is unlikely to advance greatly this week. The five-day cumulative precip maps suggest another wave of rain will hit saturated areas. These delays to harvest will cast doubt about chances of hitting the big yield targets the USDA has suggested.”

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Tuesday’s Grain Market Review

Soybeans closed lower Tuesday on concerns about the ongoing trade dispute between China and the U.S. and the potential for drier weather in the next seven days. 

Barclays analysts said in a note to clients that the dispute between the countries – the world’s two biggest economies – won’t end soon. The Financial Times reported that U.S. officials have said President Trump wouldn’t engage in trade talks with China’s Xi Jinping at the Group of 20 meeting next month unless Beijing produces a detailed list of concessions. China has such a list but won’t present it without receiving its own guarantees, the newspaper reported. 

Excessive rain in parts of the Corn Belt the past two weeks has left some producers and traders alike worried about the timing of the harvest, but drier weather is on the way that could accelerate crop collection, forecasters said. 

Drier weather is in the six- to 10-day forecast across the Midwest and Delta, which will favor corn and soybean harvesting, forecaster Radiant Solutions said in a report. Precipitation should ease “a bit” in the northern and western Midwest in the next week. 

Soybean futures closed down 8¢ to $8.61¾ a bushel on the Chicago Board of Trade. Soymeal fell $1 to $3176.50 a short ton and soy oil lost 0.42¢ to 29.22¢ a pound.

Corn futures lost 1¾¢ to $3.64¾ a bushel on Tuesday.

Wheat added 2¢ to $5.16 a bushel in Chicago, while Kansas City futures gained 3¼¢ to $5.20¾ a bushel. 

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Monday’s Grain Market Review

DES MOINES, Iowa — On Monday, the CME Group’s farm markets closed mostly lower.

At the close, the December corn futures finished 1¾¢ lower at $3.66. March futures ended 1½¢ lower at $3.78½.

November soybean futures finished ¾¢ higher at $8.69¾. January soybean futures settled ½¢ higher at $8.83.

December wheat futures settled 7¢ lower at $5.14.

December soymeal futures closed 1.10¢ per short ton lower at $318.50.

December soy oil futures closed $0.23 higher at 29.64¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.07 lower, the U.S. dollar is higher, and the Dow Jones Industrials are 7 points higher.

Jack Scoville, The PRICE Futures Group’s senior market analyst, says that the rains should be bullish, but the government is closed today and trading is very thin.  

“We still have a big harvest coming on and I suspect that is keeping buyers on the sidelines. USDA, on Thursday, is expected to show huge crops again. I am selling for one of my Brazilian clients in the beans just above the market,” Scoville says.  

Scoville adds, “I am hearing of firming basis in the western Corn Belt, on a lack of farmer-selling. Looks like rains the first half of the week, then drier and cool, but not completely dry. Should be choppy here until Thursday, then we see the USDA numbers and go from there.”

Al Kluis, Kluis Advisors, says that trade issues keep the grain markets lower.
“Trade tensions continued to increase with China over the weekend. That is taking their stock market sharply lower and putting pressure on the grain markets,” Kluis stated to customers in a daily note.

Meanwhile, harvest delays are expected to continue, this week and next, according to WxRisk. com.

“The pattern has not changed, and is just as wet as it was on Friday. Expect 2 to 7 inches of rain hitting over 60% of the Corn Belt over the next three days,” David Tolleris, WxRisk.com meteorologist says.

Tolleris adds, “In the extended six- to 10-day forecasts, it stays wet in the western Corn Belt, while the eastern Corn Belt remains dry. Then it gets very cold with temps in the 20s and 30s by next weekend. This also brings in drier conditions for the western and central Corn Belt.”

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