Ag Market View for Sept 29.22


Soybean futures managed small gains before Fridays USDA stocks report. Trade estimated US Sep 1 soybean stocks near 242 mil bu versus USDA 240. Trade is expected to react quickly to USDA actual number versus the trade average. Financial markets are back trading fear of higher interest rates, recession and lower demand for raw materials. Soybeans are seeing some evening up before month end, quarter end and USDA stocks report. Some feel USDA soybean carryout could be higher than the average trade guess. Weekly US export sales were 37 mil bu with total commit near 982 vs 889 last year. Some feel higher US supply and talk of record South America 2023 crops could weigh on futures. There was active soybean spread trading last night before USDA report. SX may be settling into a 13.50-14.50 range. South America soybeans are still a discount to US.

Bloomberg Finance LP chart
Bloomberg Finance LP chart


Corn futures ended marginally lower. Financial markets are back trading fear of higher interest rates, recession and lower demand for raw materials. Some feel USDA estimate of US Sep 1 corn stocks could be lower than the average trade estimate. This could rally futures. Historically USDA does not count corn in transit, This could suggest USDA estimate could be close to what is both on farm and off given slow exports and farmer should have relatively low 2021 stocks. Cash basis is mixed. Lack of farmer selling is supportive but open harvest weather could increase cash movement. Drop in navigation water levels could also weigh on the basis. Weekly US corn export sales were only 20 mil bu with total commit near only 511 mil bu vs 996 last year. For the year, US corn feed use should be near 5,600 mil bu vs 5,603 ly. Ethanol 5,330 vs 5,033 ly. Exports 2,475 vs 2,747 last year. Ukraine and South America corn export prices are a discount to US. Some fear above average South America crops could reduce final US exports to closer to 2,000 mil bu vs USDA 2,275 and 2,747 last year.


Wheat futures ended lower. Financial markets are back trading fear of higher interest rates, recession and lower demand for raw materials. Wheat market saw some selling after news that Algeria bought Russian wheat at discount. EU wheat basis levels dropped on the news. Weekly US wheat export sales were near 10 mil bu with total commit near 392 vs 407 last year. US export wheat prices remain a premium to Germany and French, Germany and French wheat export prices remain a premium to Russia. There could be some additional selling in wheat given uncertainty over Ukraine policy over Russia annexing 4 Ukraine states and what would Russia do if Ukraine tries to take those states back. USDA Sep 1 wheat stocks is up to the residual. Most years Q1 feed use is higher than the entire year.

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