October 7 Afternoon Comments

By Steve Freed

Soyoil and corn traded higher. Soybeans, wheat and soymeal traded lower. US Dollar was higher. Crude was higher. Gold was lower.

SOYBEANS

Soybeans are trading near key resistance. Friendly USDA estimate of US Sep 1 soybean stocks and anticipation that on Thursday USDA will lower US 2019/20 soybean carryout is helping support prices. Concern that US and China may not reach a trade deal this week is offering resistance. In a week, without a deal US could impose an additional 5 pct tariff on $250 billion dollar of China goods that currently have a 25 pct tariff. US 2019 soybean crop should still be rated 55 pct good/ex and harvest should be near 16 pct don vs 7 last week. Average trade guess for the 2019 crop as of Oct 1 is 3,563 mil bu vs USDA Sep estimate of 3,633. North half of Brazil is turning drier. Planting pace has slowed due to the dryness. Weekly US soybean exports were near 38 mil bu vs 36 last week and 22 last year. Season to date exports are near 154 mil bu vs 131 last year. USDA goal is 1,775 mil bu vs 1,745 last year. Some private estimate are as low as 1,675.

Soybean Futures Chart

CORN

Corn futures are trading near key resistance. When CZ was below 3.60 late in August farmers said they might sell corn if futures got back closer to 3.90. So far no word of big increase in sales. A friendly USDA estimate of US Sep 1 corn stocks and a slower than normal harvest pace has helped prices. US 2019 corn crop should still be rated 57 pct good to excellent and harvest should be near 19 pct don vs 11 last week. Average trade guess for the 2019 crop as of Oct 1 is 13,588 mil bu vs USDA Sep estimate of 13,799.US 2019/20 carrying dropped from 2,441 mil bu to 2,114. While still adequate plug in a lower 2019 crop and forecasted demand and US 2019/20 carryout could drop from USDA 2,190 to somewhere between 1,600-1,840. Difference in numbers is what analyst are using for exports. Weekly US corn exports were near only 18 mil bu vs 57 last year. Season to date exports are near 79 mil bu vs 232 last year. USDA goal is 2,050 vs 2,067 last year. Some private estimates are as low as 1,815. Normal 2020 World crops and higher 2020 US acres and supply could send CZ20 eventually well below 4.00.

Corn Futures Chart

WHEAT

Wheat futures closed mixed. Run up in Chicago wheat futures linked in part due to good demand for storage and lower crop supplies. Drop in KC what linked in part to slow demand, low protein froma bigger supply/crop. Big premium of Minn wheat futures over both Chicago and KC due to concern over the quality of the final crop yet to be harvested in US North plains and Canada. This weeks winter storm there will not help. Some tough feel KC may be near season lows and Chicago and Minn could be near season highs. Weekly US wheat exports were near 14 mil bu vs 18 last week and 16 last year. Season to date exports are near 327 mil bu vs 270 last year. USDA goal is 975 mil bu vs 936 last year.

Wheat Futures Chart

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2019-10-07T21:02:28+00:00 October 7th, 2019|