CORN HIGHLIGHTS:

• Overall, it was a quiet session in the corm market on Wednesday as Dec corn seems to be pinned to the 420 area on the chart. Slight buying strength in wheat and soybeans helped support corn prices. Trading range from high to low on Dec corn was 3 ½ cents during the session.
• USDA announced a flash export sale of corn on Tuesday morning. Uknown destinations bought 126,000MT (5.0 mb) of U.S. corn for the current marketing year.
• Weekly US ethanol production continues to show strength. Production last week increased by 23,000 barrels per day to 1.038 million. Current corn usage is ahead of the expected pace for the current marketing year.
• USDA will release weekly export sales on Thursday morning. Expectations for corn export sales from last week are to range from 900,000 – 1.7 MMT of new sales. On last week’s report, corn export sales totaled 1.684 MMT.
• The USDA will release the next Crop Production and Supply/Demand report on Friday morning. Expectations are for corn yield to decrease slightly to 183.5 bushels per acre, down 0.1 bushels from last month. With improved demand, and slightly lower potential production, corn carryout for the marketing year is looking to be lowered for the fourth consecutive month to just below the key psychological level of 2.000 billion bushels.

SOYBEAN HIGHLIGHTS:

• Soybeans managed a positive close today, despite yesterday’s negative price action and continued improvements to Brazil’s rainfall outlook. Technical support levels may have aided today’s small rally. For the November contract, both the 40- and 50-day moving averages are converged around the 1010 level – this was tested yesterday and again today, indicating it may be a key area of support.
• The decline in the Chinese stock market on Wednesday may cause concerns about their economy, and thus their demand for soybeans. Beijing’s attempt at economic stimulus has reportedly been disappointing, and this could pressure US commodity and equity markets.
• On a bullish note, the potential for higher biodiesel mandates in Indonesia could lead to a tightening supply of palm oil. This, in turn, could support US soybean oil futures. Currently, Indonesia has a 35% mandated palm oil blend in their biodiesel, but that could be increased to 40%. It is estimated this would lead to 1.5-1.7 mmt additional palm oil use.
• Brazil weather stays as a focus in the soybean market. Rain chances continue to improve, especially for the middle to last half of October. Brazil soybean planting is 4.5% complete according to Brazil analyst, AgRural. This was up 2% week over week, but down 5.5% from last year.
• USDA will release weekly export sales on Thursday morning. Expectations for news sales last week are to range from 800,000 – 1.7 MMT. Last week’s report posted sales of 1.444 MMt, which was within the range of estimates for the report. Current soybean demand has been good, supporting prices.

WHEAT HIGHLIGHTS:

• Wheat was again the upside leader today in the grain complex. Initial strength came from a gap higher in Paris milling wheat futures. However, the Matif wheat ended up closing in the red, yet US futures rejected that negativity. Support also came from higher Ukrainian export quotes after the recent attacks on grain vessels.
• The Russian agriculture ministry is reported to have called for an emergency meeting of grain exporters on Friday. The focus of the meeting will be discussion surrounding potential export restrictions. Part of the reason for this could be dryness in southern Russia, especially with winter grain planting finishing soon.
• According to the Rosario Grains Exchange, recent rains in key growing regions of Argentina have not been enough to reverse potential losses in many wheat fields. In the last 24 hours Argentina is said to have received 2-10 millimeters of rain, but as stated by the exchange, 25-30 millimeters were needed. In addition, the exchange is estimating their 24/25 wheat production at 20.5 mmt, but has said they will likely cut that estimate due to dryness.
• According to the European Commission, EU soft wheat exports are down 29% year on year, since the season began on July 1. As of October 6, their exports have reached 6.35 mmt compared with 8.9 mmt the year prior. The top importers were north African nations, led by Nigeria at 937,000 mt.

DAIRY HIGHLIGHTS:

• After 13 days of closing red, spot cheese closed today unchanged at $1.90375/lb. with 0 loads being traded.
• Class III milk ended the day mixed, October closed down 5 cents at $22.57, while November closed up 2 cents at $21.15.
• Class IV futures had a slow day with most contracts closing unchanged with no volume traded.
• Spot butter closed down 2.75 cents to close at $2.6500/lb.
• Spot whey went unchanged to close at $0.60/lb. and spot powder remained unchanged as well at $1.3550/lb.

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Author

Brandon Doherty