CORN HIGHLIGHTS:

• Risk off trade on Thursday as the market saw fallout from the Fed’s commentary regarding holding a longer-term view of a high-interest rate environment. This brought selling across most equity and agriculture markets on the day. December corn gave back Wednesday’s gains, losing 7 cents on the session.
• Weekly export sales for corn are still disappointing. Last week totaled new sales of 567,000 MT (22.3 mb). Current corn sales commitments for the marketing year are down 6% from last year, and the USDA is forecasting a gain in potential exports.
• The USDA announced a flash export sale of corn overnight. Mexico bought 137,160 MT of corn, split at 121,920 MT for the 2023-24 marketing year and 15,240 MT for the 2024-25 marketing year. The total was 5.4 mb.
• The International Grain Council (IGC) raised its yearly global corn stocks forecast. The IGC is forecasting global carryover stocks at 289 mmt, up 14 mmt from last year’s estimates, reflecting the increase in projected global production.
• Corn harvest continues to ramp up, with early yield results being extremely variable based on the weather for the past growing season. Harvest pressure will likely affect the cash basis.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day sharply lower, and below its 100-day moving average, following a poor export sales report for last week, anticipation of a large Brazilian crop next season, and harvest pressure within the US. Both soy products closed lower today as well.
• For the week ending September 14, 2023, the USDA reported an increase of 16 mb of soybean export sales in 23/24, which came in below the low end of the estimate range. Last week’s export shipments of 20.0 mb were below the 34.8 mb needed each week to meet the USDA’s estimates and were primarily to China, Japan, and Mexico.
• Basis is expected to erode further into harvest as low water levels on the Mississippi River once again affect barge traffic. Heavy rains are expected from the northwestern Plains through Texas and Arkansas over the week which could help improve water levels.
• While Brazil increased their estimated planted area of soybeans by 2.8% and are now expecting a new record crop of 162.4 mmt, there is an El Nino pattern developing which is already causing some dry weather in areas where soybeans were just planted. This dry weather could continue through the growing season.

WHEAT HIGHLIGHTS:

• The markets took a risk off posture today with lower closes in grains, livestock, some soft commodities, and, as of writing, crude oil is still positive but is about a dollar off the daily high. The negative tone today appears to be spurred on in part by yesterday’s Fed meeting in which they indicated that interest rates down the road would continue to increase.
• The USDA reported an increase of 11.3 mb of wheat export sales for 23/24 and an increase of 0.5 mb for 24/25. Each week 14 mb needs to be shipped to reach the USDA’s goal of 700 mb of exports, but last week’s shipments were only 10.9 mb.
• The US Dollar Index made a new near-term high today and is hitting levels not seen since March. While it is overbought and may be due for a correction downward, it has been inching higher since mid-July, keeping constant pressure on the export market.
• According to Sov Econ, their estimate of 2023 Russian wheat production was reduced to 91.6 mmt, versus 92.1 mmt, due to expectations for a reduced Siberian crop.
• Ukraine’s Ag minister talked with the Polish Ag minister to discuss a resolution to the grain dispute between the two nations. Poland has banned imports from Ukraine to protect domestic prices, so the goal of the talks is to resolve the dispute on shipments.

DAIRY HIGHLIGHTS:

• Spot butter rallied once again on Thursday and is now up a whopping 21.75c so far this week.
• The cheese trade was down for the fifth day in a row. For the week, the block/barrel average has fallen 17.75c to $1.6675/lb.
• The powder market had its largest up day since February 3rd, adding 3.25c and closing at $1.16/lb.
• The Class IV market saw heavy volume trade as contracts closed double digits higher. The leader during the session was October 2023, adding 54c to $19.75.
• Class III contracts were able to find support and closed well off of intraday lows.

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Author

Brandon Doherty