CORN HIGHLIGHTS:

• Quiet and choppy trade continued in the corn market today as the market awaited the Fed Reserve decision on interest rates. The trading range was small again with December corn prices ranging 4 cents from high to low during the session.
• The Federal Reserve cut the federal funds lending rate by 0.50%. Reduction of interest rates signals a looser monetary supply, which could trigger the weakening of the US Dollar. This interest rate move could also signal a more inflationary environment, which should help support some commodity markets.
• Weekly Ethanol production dropped by 2.9% from last week to 1.049 million barrels per day. This number was up 7.0% from last year. Corn used last week for the ethanol grind totaled 105.84 mb.
• USDA will release weekly export sales on Thursday morning. Expectations for corn sales to range from 550,000 – 1.4 mmt. Last week’s sales were disappointing at 666,458 mt as an increase in corn prices and freight costs due to low river levels may have limited corn export sales.
• US weather is likely to remain drier than normal with above normal temperatures, which should help push the corn crop to maturity and speed up harvest. Harvest pressure going into October and November will likely limit upside potential in corn prices.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day higher after going through a wide trading range throughout the day. Futures were as much as 14 cents higher overnight before fading and then rallying back in the last two hours of the session. The Federal Reserve cut interest rates by 50 basis points before the market closed, which was slightly unexpected and may have added support to soybeans on the close.
• Soybean meal ended the day slightly lower, but soybean oil was consistently higher throughout the day despite a slight decline in crude oil. India, who is the number one importer of veg oils, raised its veg oil import tariffs by 20%, but consumption is still anticipated to grow 2% – 3% due to rising prosperity and a growing population. Palm and canola futures were also higher and lent support to bean oil.
• In South America, conditions have been very dry, especially in Brazil, and key growing areas such as Mato Grosso are forecast to have at least 10 more days without rain. Chances of rain improve for early October, but if the rain does not materialize, it could be friendly to soybean prices.
• Although the US is planning to impose higher tariffs on Chinese products like electric vehicles and metals, China has remained a steady buyer of new crop soybeans, and there has been speculation that China may be looking to make more purchases with FOB prices in Brazil significantly higher than in the US.

WHEAT HIGHLIGHTS:

• With the exception of a quarter-cent loss in the March contract, Chicago wheat closed unchanged across the board. Kansas City and Minneapolis futures did not fare quite as well, posting small losses. Throughout the session, wheat traded on both sides of neutral. With little fresh news and markets awaiting interest rate updates, the trade remained relatively quiet by the end of the session.
• This afternoon, the Federal Reserve concluded its FOMC meeting with a decision to cut interest rates by 50 basis points, pushing the US Dollar Index to its lowest level since July 20, 2023. If the index’s downward trend continues, it could benefit US wheat exports, as a weaker dollar makes US products more affordable for importing countries.
• A La Niña weather pattern appears to be developing this fall, though the Australian Weather Bureau predicts it will be weak and short-lived. Typically, La Niña brings more rain to Australia and less to the Americas. In contrast, a US government weather forecaster suggested a 71% chance of La Niña forming between September and November, potentially lasting until March.
• Egypt’s supply minister reported that the country has sufficient wheat reserves to last at least six months, following recent purchases of 770,000 mt of wheat from Russia and Bulgaria. Egypt consumes around 18 mmt of wheat annually, with approximately 7.7 mmt used for subsidized bread production.

DAIRY HIGHLIGHTS:

• Spot cheese continues its run, gaining another 1.25 cents to close at $2.43375. Barrels have pushed to a crazy 37.75 premium over blocks, however.
• Class III lost some of yesterday’s gains and closed mostly red today. October futures lost 30 cents to close at $23.60 and November lost 38 cents to close at $22.83.
• Spot whey ended the day at $0.5950/lb with no loads traded today and no change from yesterday’s trade.
• After yesterday’s gains, spot butter closed 8 cents lower at $3.0050/lb. Spot powder also closed down, losing 1 cent to close at $1.3825/lb.
• Class IV futures ended the day in the red. October futures lost 39 cents and closed at $22.35 and November lost 42 cents to close at $22.25.

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Author

Amanda Brill