Afternoon Market Highlights


Highlights

The row crops traded higher on borrowed strength in the crude oil market (from Iran’s attack on Saudi Arabian refineries) and additional soybean sales to China.  The wheat market drew strength from crop concerns in Australia and Argentina and spillover strength in the corn market. Plans are being made to increase the required yearly biofuels blend for refineries to offset the exemptions that were made available to small refineries a couple of weeks ago.    

  • The energy markets were higher with crude oil trading $7-$ bucks higher at $62.75/barrel.
  • The US$ is trading higher, up 386 at 98.64, the gold market is up $9-$10 bucks at $1,502/ounce and the CD$ is up 0.00225 at 0.75515.
  • DJIA is down 13 at 27085, S&P down 7-8 at 2999 and the ANSDAQ down 24-25 at 8152.
  • The next USDA crop report is the Small Grains Summary and Sep 1 Grain Stocks, which are scheduled for release on Monday, September 30th at 11 AM CDT. 

Corn

The corn market traded higher on spillover strength in the crude oil market.  Gains were limited from improving weather forecast for much of the US Midwest this week. 

  • Closes: December at $3.74, up 5 ¼ cents, July at $4.01 ¼, up 4 ¼ cents and red Dec at $4.10 ¾, up 4 cents.
  • Weekly export inspections came in at 422 tmt, near the low end of the trade estimates (400-700 tmt).
  • Japan’s corn imports from the US are expected to stay fairly steady around 15.0 mmt over the next several years, unless the US can provide a big enough incentive for them to increase their corn purchases significantly from what they currently purchase.
  • Weather forecasts suggest warm/dry weather for much of this week, which should be beneficial to the developing corn crop.
  • Crop conditions are expected to decline 1% to 54% G/E (53-55).Harvest progress is estimated at 4% complete (2-6).
  • Spreads: Z/H 12 carry, H/K 8 ½ carry, Z/N 27 ¼ carry, Z/Z 36 ¼ carry. 

Oilseeds

The soybean market traded both sides with strength coming from the crude oil and soyoil oil markets. Prices drew additional support from this morning’s soybean sale to China, with thoughts of easing tensions between the US and China. Pressure stemmed from lack of demand and improving weather conditions.  The bean crop is turning in many areas with thoughts that we could see newly harvested soybeans in 2-3 weeks.  

  • Closes: November at $9.00, up 1 ¼ cents (levels not seen since the end of July), January at $9.13 ¾, up 1 ½ cents, July at $9.45 ½, up 2 ½ cents and red November at $9.55 ¾, up 2 ½ cents. The products were mixed with meal down 2-3 bucks and oil up 85 points.
  • Soyoil prices rose on borrowed strength in crude oil.
  • Weekly export inspections were reported at 666 tmt, near the low end of the trade estimates (600 tmt-1.0 mmt).
  • The USDA announced the sale of 256k tonnes of beans to China for the 2019/20 marketing year.This comes in addition to the 204 tonnes sale announced last Friday.
  • NOPA reported 168.085 million bushels of soybeans crushed in August.Soyoil stocks were reported at 1.401 billion pounds and meal exports were reported at 699,212 tons.
  • The soybean crop is expected to get a boost from this week’s warm/dry weather conditions.
  • Crop conditions are expected to be 54% G/E (53-55), down 1% from last week.
  • Spreads: X/F 13 ½ carry, F/K 22 ¾ carry, X/N 45 ½ carry. 

Wheat

The wheat market traded higher on a bout of short covering and concerns of dryness in Australia and Argentina’s wheat area.  Mpls lagged KC and Chicago with the resumption of the spring wheat harvest.   

  • December closes: Mpls at $5.09, up 3 ½ cents, KC at $4.07 ¾, up 8 cents and Chicago at $4.88 ¾, up 5 ¼ cents.
  • Weekly export inspections were reported at 459 tmt versus trade estimates of 400-600 tmt.
  • Dry weather concerns remain for Australian and Argentine wheat areas.
  • Warm/dry weather across the Northern Plains this week is expected to allow farmers to resume spring wheat harvest.Last week’s progress was at 71% complete and there was very little harvest done last week.Harvest began late yesterday with more areas getting underway as of noon today or late afternoon.
  • Paris mill wheat traded higher on weakness in the Euro and strength in the US wheat market.
  • Australia looks to Canada to source their future wheat needs. As of August 30th, they have issued licenses for as much as 300k tonnes of Canadian wheat.
  • Spring wheat harvest is expected to be near 82% complete (79-85). This compares to 71% last week.
  • Winter wheat seedings are estimated to be near 8% complete, with a range of 4-15%.
  • Spreads: Mpls Z/H 14 ½ carry, Z/Z 62 ½ carry, Kansas City Z/H 14 carry, and Z/Z 63 ¾ carry.