CORN HIGHLIGHTS:

• Concerns regarding the general US economy after a disappointing jobs report, and downward revisions in previous job creations number triggered a risk off mindset across a majority of the markets. This negative tone spilled over into the corn market, putting a potential cap on the most recent rally.
• Dec corn futures finished 5 ¼ cents high on the week, but resistance at the $4.11 area held, and the weak price action on the day formed a bearish reversal on the daily charts. The key will likely be the price action next week.
• The USDA released the weekly export sales report this morning. For the last week of the marketing year, old crop corn saw net cancelations of 173,000 MT (6.8 mb) but new crop sales were strong at 1.843 MMT (71.7 mb). Some of the activity was rolling old crop sales into the new marketing year. The last two weeks on new crop corn sales have been above market expectations. Mexico continues to be the largest buyer of US corn.
• Logistics may become an issue in the corn market as harvest nears. Mississippi River levels in the Memphis area are at restrictive levels, reducing the volume of bushels that can be transported. The Army Corp of Engineers are dredging the area, but the additional freight costs will make US corn more expensive versus other global competitors.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day sharply lower going into the weekend after a revision in jobs data showing slower growth shook the whole market. November soybeans made a significant bearish reversal after moving up to but failing at the 50-day moving average. Soybean oil led the complex lower with a loss of 3.55% in the October contract and soybean meal was lower as well.
• For the week, November soybeans gained 5 cents at $10.05 and March 25 soybeans gained 4-3/4 to $10.36-1/2. December soybean meal gained $11.40 to $324.40 and December soybean oil lost 2.38 cents to 39.63 cents. Funds had previously been exiting short positions earlier this week but clearly added to that position in a big way today.
• Today’s export sales report was strong for soybeans and provided support this morning before other macro events brought markets lower. There were net cancellations of 8.4 mb of soybeans for 23/24 but an increase of 60.9 mb for 24/25 which was above trade expectations. Last week’s export shipments of 18.0 mb were below the 21.4 mb needed each week to meet the USDA’s expectations. Primary destinations were to China, Mexico, and Indonesia.
• In Argentina, soy crush workers had previously been striking due to low wages, but an agreement was reached between the union and agricultural traders which has ended the strike. They achieved a 26% raise.

WHEAT HIGHLIGHTS:

• Wheat posted losses alongside the rest of the grain complex, most other commodities, and the stock market. It appears to have been a risk off session caused by a combination of a technical correction from overbought territory, profit taking at key resistance levels, and a jobs report this morning that indicated the economy added fewer jobs than expected; there were also downward revisions for the previous two months.
• The USDA reported an increase of 12.5 mb of wheat export sales for 24/25, and net cancellations of 0.4 mb for 25/26. Shipments last week at 23.4 mb exceeded the 15.9 mb pace needed per week to reach the USDA’s export goal of 825 mb. Sales commitments for 24/25 have reached 378 mb which is up 31% from last year and above the USDA’s estimated pace of 17% higher.
• Argentina’s wheat production estimate was left unchanged by the Buenos Aires Grain Exchange at 18.5 mmt. This is despite drought conditions affecting some key growing regions. For reference, the USDA estimate is 18.0 mmt. There were some storms over the past weekend that may have helped stabilize the crop, but dry weather is likely to follow for at least the next week.
• Russia has reportedly reduced their wheat export tax by 19% to 906.4 rubles per mt (for the period ending September 17). Additionally, Russian export prices for wheat remain cheap; the week was ended at $217 per mt which is unchanged from the past few weeks.
• The global wheat production estimate was increased to 791.4 mmt, according to the UN Food and Agriculture Organization. This compares with the July estimate at 789.1 mmt. Better than anticipated crops in the US and upward revisions in China and Argentina are cited as the reason for the increase. However, there were downward revisions for both Russia and the EU.

DAIRY HIGHLIGHTS:

• Class III futures fell for a third consecutive day on Friday seeing losses between 6-29 cents. The only Class III contract to see positive movement was the September ’24 contract which improved 17 cents to $22.78.
• Spot cheese improved 3.25 cents heading into the weekend to close at $2.2725/lb. Whey added 2 cents to close at $0.5875/lb.
• Class IV futures were little moved on light volume trading. The October ’24 contract tacked on 10 cents to close at $22.80 while the December ’24 contract added 3 cents to go home at $21.88.
• Spot butter tacked on 1.25 cents to close out the week at $3.1750/lb while powder improved 0.75 cents to $1.3650/lb.

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Author

Brandon Doherty