Ag Market View for Sept 28.23


Prices closed $.04 – $.05 higher with Dec-23 making new highs on the close stopping just shy of the Sept-23 high of $4.90 ¼.  The eastern corn belt will begin to dry out over the  next 24 hours enabling harvest progress to resume this weekend or early next week.  Favorable harvest conditions in the western corn belt are expected to extend into the middle part of next week with a warmer than normal bias across the nation’s midsection into mid-October.  Export sales at 33 mil. bu. were in line with expectations.  YTD commitments at 495 mil. are still down 3% from YA, vs. the USDA forecast of up 23%.  Commitments represent 24% of the USDA export forecast of 2.050 bil. bu., well below the historical average of 34%.  Pace analysis continues to suggest the USDA export forecast seems optimistic.  US corn areas in drought held steady this week at 58%.  Today the EU lowered their 2023 corn production forecast by nearly 2 mmt to 59.8 mmt, in line with the Sept-23 USDA forecast of 59.4 mmt.  They also increased their corn import forecast 3 mmt to 20 mmt, still well below the USDA forecast of 24 mmt of imports.  Reports suggest China has purchased several hundred thousand tons of Ukrainian corn for Nov-Dec shipment.  These sources didn’t provide the cost nor route of transport.    

quote screen and charting


The soybean complex was mixed with beans $.03 – $.04 lower, meal was up $2 – $3, while oil was 100 – 130 lower.  After rejecting trade over the 100 day MA yesterday, Nov-23 beans pulled back in early trade, only to rebound and close near $13.  The 100 day MA at $13.06 ¾ now serves as resistance.  Dec-23 soybean oil fell back below its 100 day MA and briefly pierced support at the Sept low of 56.62 before bouncing a touch.  Dec-23 meal briefly traded thru its 100 day MA resistance at $393 before pulling back.  US drought monitor showed a noticeable decline in drought conditions across the northern plains.  Rain in west central Brazil the past 24 hours was a bit better than expected.  There are additional chances for scattered showers into early next week.  Increased rain activity and milder temperatures appear more probable in week 2 of the outlook.  No meaningful change to drought conditions in Argentina are seen for at least another week to 10 days.  Export sales at 25 mil. bu. were at the low end of expectations.  YTD commitments at 652 mil. bu. are down 34% from YA, vs. the USDA forecast of down 10%.  Commitments represent 36% of the USDA forecast, below the historical average of 48%.  Combined meal sales at 359k tons were in line with expectations.  Safras & Mercado forecasts Brazil’s 23/24 soybean crop at a record 168.9 mmt, above the USDA forecast of 163 mmt.  They expect Brazil will crush 55 mmt, while exporting 99 mmt, vs. the USDA forecasts of 55.75 mmt and 97 mmt respectively.  The Malaysian Palm Oil Board expects 2024 PO production will rise to 19.0 mmt, just above the 18.45 mmt from YA, despite the presence of El Nino.  They also expect exports will increase 4% to 16.3 mmt.  China has confirmed its new standard moisture requirement for soybean imports will be 13% starting Dec 1st


Prices were lower across all 3 classes with Chicago and MGEX $.01 – $.04 lower while KC was down another $.08 – $.10.  Next support for Dec-23 KC is $6.66, the Sept-21 low on the spot weekly chart.  Dec-23 MGEX scored a new contract low.  Chicago Dec-23 held support above its contract low at $5.70.  This week’s US drought monitor showed a noticeable decline in drought conditions across the northern plains.  Export sales at 20 mil. bu. were the highest in 7 weeks and above expectations.  YTD commitments are down 14% from YA, vs. the USDA forecast of down 8%.  US durum areas in drought plunged 15% to 41%.  Spring wheat areas in drought fell 8% to 51%.  The EU lowered their 23/24 soft wheat production forecast by nearly 1 mmt to 125.3 mmt.  While the Ave. trade guess for HRW wheat production is down a few mil. bu. from the Aug. estimate, the market seems to be bracing for higher production given this week’s trade action. 

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