Prices rejected the new 2 year low made overnight, closing $.04 – $.05 higher, finishing near session highs. Not much resistance for Dec-23 corn until this month’s high at $4.90 ¼. Next support is $4.56. The fundamental argument for today’s price jump would be that additional weather premium is needed if soybean plantings in Mato Grosso are delayed into late October resulting in the 2nd corn crop planted beyond its optimal window next Feb/Mch timeframe. Brazil’s 2nd crop corn harvest for 22/23 has reached 97% while their 1st crop plantings for 23/24 MY in the center south region are 21% complete, in line with YA. US crop ratings fell 1% last week to 51% G/E, in line with expectations. With the updated acreage, crop condition data and ear population data my model is forecasting an average yield of 172.8 bpa, with production at 15.052 bil., just below last week’s USDA forecast of 15.134 bil. and yield of 173.8 bpa. The USDA is forecasting record ear populations in IA, IL, IN, and WI. 90% of the crop is dented and 54% mature, both above the 5-year Ave. Harvest has reached 9%, vs. YA and 5-year average of 7% EU corn imports July 1st thru Sept 15th have reached 3.3 mmt, down from 5.94 mmt YA. Ethanol production tomorrow at 9:30 AM CST is expected to slip a bit from LW 1,039 tbd pace. Conab forecasts Brazil’s 23/24 corn production at 119.8 mmt, down from 131.9 mmt last year as they expect acres to fall 5%. Their production forecasts remain well below the USDA est. of 129 mmt for 23/24 and 137 mmt for 22/23.
The soybean complex closed mixed with soybeans $.01 – $.02 lower, meal $1 – $2 higher, while oil was down 45 – 65. Nov-23 beans traded to a new monthly low however held support above its 100 day MA at $13.04 ½. Oct-23 meal also made a new monthly low before recovering. Oct-23 oil closed near its low, next support is the Sept-23 low at 60.05. US weather has light precipitation moving thru the nation’s midsection today. Heavier rains are forecast for much of the western corn belt later this week and into the weekend leading to a slowdown in harvest progress. Brazilian weather shows limited prospects for rain into early October, threatening a slow start to soybean plantings in the west central states of Mato Grosso and MGDS. Soybean conditions held steady at 52% G/E, however there was a 1% shift from excellent to good resulting in the CC index slipping to 78.6, matching the lowest level since 2013. With the updated acres, crop ratings, and USDA pod count data my model is forecasting an average yield of 4.167 bil. and yield of 50.3 bpa, just above the USDA forecast of 4.146 bil. and yield of 50.1 bpa. 54% of the crop is dropping leaves, ahead of YA at 39% and the 5-year Ave. of 43%. 5% of the crop has been harvested, vs. 3% YA and the 5-year Ave. of 4%. EU soybean imports thru July 1st thru Sept 15th have reached 2.56 mmt, in line with YA. Abiove suggests Brazilian soybean crushing capacity will reach 75 mmt by 2024, up 9% from the 69.2 mmt currently. The USDA forecasts Brazilian crush at 59.7 mmt in their 2023/24 balance sheet. Conab forecasts Brazil’s 2023/24 soybean production at 162.4 mmt, up from 154.6 mmt last year as they expect acres to increase 2.7% to 45.3 mil. HA. Their production forecast remain are consistent with the USDA est. of 163 mmt for 23/24 and 156 mmt for 22/23.
Prices were mixed with Chicago $.04 – $.07 lower, KC down $.03 – $.04, while MGEX was up $.01 – $.03. Both KC and MGEX were well off the overnight lows. While addressing the UN General Assembly Pres. Biden today pledged the US strongly supports Ukraine and their efforts to bring a just and lasting peace while describing Russia’s invasion as an illegal conquest. Ukrainian Pres. Zelenskyy accused Russia of weaponizing food creating artificial shortages while urging all to unify in order to defeat Russia. Australia’s Bureau of Meteorology suggests El Nino conditions are likely to persist into Spring-24 leading to yield reducing stress for their countries wheat crop. Ukraine has planted 1.87 mil. HA’s of winter crops including 515k hectares of winter wheat, roughly 12% of the expected 4.4 mil. HA’s. EU soft wheat exports July 1st thru Sept 15th have reached 6.32 mmt, down from 8.7 mmt YA. Sources suggest Algeria has begun to purchase milling wheat with today’s tender. Initial volume est. of 120k mt at $272/mt C&F. Spring wheat harvest progress has reached 93% in line with YA and the historical average. Winter wheat plantings have reached 15% complete, just behind YA pace of 19% and the 5-year Ave. of 16%. Egypt’s GASC is seeking to buy wheat for Nov delivery in a tender that closes tomorrow.
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