TFM Midday Update 8-29-2024

The CME and Total Farm Marketing Offices Will Be Closed
Monday, September 2, in Observance of Labor Day

CORN

In its weekly export sales report, the USDA reported an increase of 0.6 mb of corn export sales for 23/24 and an increase of 58.8 mb for 24/25 in the week ending August 22. Shipments last week at 41.3 mb exceeded the 33.8 mb pace needed per week to reach the USDA’s export goal of 2.250 bb.
China has reportedly asked private feed companies not to import barley or sorghum in an effort to support their domestic market. While corn was not directly mentioned, this could be overall bearish to the grain markets if China decides to curb imports. Interestingly, there was a flash sale announced this morning for 118,000 mt of sorghum for delivery to China during the 24/25 marketing year.
It has been too dry in both Argentina and southern Brazil. Additionally, central Argentina and northern Brazil have seen very little precipitation for the past month or so. This could affect the establishment of the corn crops, for which planting usually begins in September.

The USDA reported net cancellations of 5.3 mb in soybean export sales for 23/24 but an increase of 96.1 mb for 24/25 in the week ending August 22. Shipments last week at 19.9 mb exceeded the 19.1 mb pace needed per week to reach the USDA’s export goal of 1.700 bb.
August has been generally dry across the Midwest, though perhaps not hot enough overall to cause big yield drops in soybeans. Nevertheless, the top could be taken off, which may be providing support to futures at these lower price levels.
Both soybean meal and oil are trading higher this morning, offering support to soybean futures. Bean oil may be leading the charge, as it is said to now be cheaper than both palm oil and South American soybean oil. Palm oil futures are trading higher today however, recovering after news that India could increase their vegetable oil import tax.

US wheat futures have traded both sides of unchanged so far this morning. Initial weakness may have stemmed from a lower trade in Paris milling wheat futures. However, at the time of writing that market has turned positive, giving a boost to the US market.
In the week ending August 22, the USDA reported wheat export sales increased 19.6 mb for the 24/25 marketing year and decreased 1.3 mb for 25/26. Shipments of 21.2 mb that week exceeded the 16.0 mb pace needed per week to reach the USDA’s export goal of 825 mb.
Reportedly Russia’s domestic cash wheat prices have moved upward. However, their exports continue to remain cheaper than other origins and relatively unchanged. Their FOB values are said to remain around $216 to $218 per metric ton.
Argus Media has estimated the French soft wheat harvest will total 25.1 mmt. If accurate, this would be a 27% decline from last year. Additionally, they believe that French wheat exports (outside of the European Union) will fall to 4.1 mmt – this would be a 60% decline.

Brandon Doherty