CORN HIGHLIGHTS:

• Corn futures stayed on their upward path as prices followed strong buying in the wheat market to close December corn at its highest price levels since June.
• The USDA will release its next Crop Production report on Friday, October 11. Before that time, we will see private analysts posting potential corn yield projections. One private analyst group in their producer survey raised the corn yield to 184 bushels per acre as their producers highlight strong yields at harvest this fall. This will likely be a trend as projections come in before the report.
• Weekly ethanol production recovered to 1.015 million barrels per day last week. A total of 102 million bushels was estimated to be used for ethanol production last week. Although this total is behind the pace to reach USDA corn usage targets, it is early in the marketing year.
• The corn market will be watching to see if corn export sales rebound after last week’s disappointing total. Last week, US exporters sold 535,056 bushels of corn, which was below the range of expectation. Expectations for new sales range from 600,000 – 1.0 mmt in Thursday morning’s export sales report.
• The US Dollar Index has turned the corner higher and is trading at its highest point in weeks. The stronger dollar plus the rally in corn prices could price US bushels out of the export market versus cheaper global competition.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day mixed, with front-month contracts slightly lower and deferred contracts closing either unchanged or slightly higher. They traded within a relatively wide range again today, rallying off early morning lows. Soybean meal traded significantly lower throughout the day, while soybean oil closed higher.
• Yesterday afternoon, StoneX released its updated estimates for soybean yields and production. The yield estimate was raised slightly to 53.5 bpa, compared to the USDA’s previous estimate of 53.1 bpa. Iowa’s yield was pegged at 64.5 bpa, Illinois at 67 bpa, and Indiana at 62 bpa.
• Forecasts for South America predict significant rainfall in both Brazil and Argentina over the next 15 days. While scattered showers have fallen intermittently, the extremely dry central region is expected to receive over an inch of rain, with southern regions likely to get even more.
• With dockworkers at ports from Maine to Texas now on strike, exports of agricultural products could be affected. While soybeans and soybean meal are typically shipped from the West Coast, rerouting other trade through western ports may cause bottlenecks, potentially impacting soybean exports negatively.

WHEAT HIGHLIGHTS:

• Wheat had a banner day with double-digit gains in all three futures classes, and Kansas City contracts led the way higher with gains of over 20 cents. This may have been driven by another sharply higher close for Paris milling wheat futures, as well as additional war premium and uncertainty continuing to be factored into the marketplace.
• Declining estimates of the Australian wheat crop have been bullish to the market. While the USDA raised their forecast last month to 32 mmt, some private estimates are now in the range of 27-30 mmt. Frost damage and dryness are the causes for the declines, with some estimating that Australia may have lost 1 mmt of wheat in key growing regions.
• GASC, Egypt’s state grain purchasing authority, is said to have bought 3.1 mmt of wheat, which is believed to be sourced from Russia. News outlets are reporting that 510,000 mt will be shipped from the Black Sea each month until the deal is fulfilled.
• According to Russia’s weather bureau, some wheat producing regions are in worse shape than usual due to a recent lack of rainfall. Additionally, Russia’s grain export union is requesting for a reduction of grain exports, with wheat making up the majority of Q1 shipments for the 24/25 marketing year. SovEcon is also reported to have reduced their Russian wheat export estimate by 0.5 mmt to 47.6 mmt; for reference the USDA is using a 48 mmt figure.

DAIRY HIGHLIGHTS:

• Class III futures gave back some early gains to finish mostly lower. The now second month November contract lost 30 cents to move to $22.31.
• Spot cheese fell 2.25 cents to $2.09/lb, its lowest point since August 23, while whey was unchanged from Tuesday.
• Class IV action was either unchanged or lower but the second month November contract did lose 19 cents, closing at $21.02.
• Spot butter lost another 7 cents today to drop to $2.68lb while powder lost a quarter cent.
• September Class III futures settled at $23.34 while the September Class IV futures settlement came in at $22.29.

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Author

Brandon Doherty