CORN HIGHLIGHTS:

• Harvest pressure, weakness in the wheat market and technical selling pressure pushed corn futures lower on the session. December corn futures lost 6 ¼ cents in weak price action on Tuesday.
• Corn harvest has reached 59% complete according to the USDA weekly Crop Progress report. This was in line with analysts’ expectations and 5% above the 5-year average.
• A strong Midwestern storm will be working its way across the Corn Belt over the next few days.  Rainfall with good coverage and a sharp drop in temperature is forecasted into the start of November.  Wetter than normal forecasts may limit harvest progress through the end of the week in some areas.
• South American weather will likely stay dry and hot for areas of Brazil, but Argentina could see some overall improvement. While South American weather is still in its early stages, the corn market is lacking any true weather premium.
• The weak price action on Tuesday is concerning as December corn closed under the support of $4.85, and March under $5.00. The soft close and downward momentum could lead to additional long liquidation in corn futures on Wednesday.

SOYBEAN HIGHLIGHTS:

• Soybeans began the day lower, but ended with gains thanks to big support from soybean meal. Continued drought in Argentina impacted their production and export of soybean meal, with the US able to pick up some of that export business. Soybean oil was lower today with lower crude and veg oils.
• Soybeans also got support from purchasing agreements that were signed today between Chinese agricultural companies and US commodity exporters at a ceremony held in Des Moines and organized by the US Soybean Export Council. 11 different agreements were made, and now trade will look to see when these purchases will be announced by the USDA.
• Yesterday’s Crop Progress report showed soybeans at 76% harvested as producers rush to get work complete before more rain falls. This is up from the 5-year average pace of 67%. The central and western Corn Belt are forecast to receive significant rain over the next 7 days.
• South American weather is coming more into focus as planting continues in poor conditions. The new 10-day forecast is showing an extended trend of hot and dry conditions in Argentina and Brazil apart from southern Brazil. Many producers are already replanting due to the dryness.

WHEAT HIGHLIGHTS:

• With US winter wheat now 77% planted and emergence at 53%, crop ratings are expected to be released next week. Expectations are for conditions to be better than last year due to the improved soil moisture levels in the southern Plains. Traders look for a rating of 45%-49% in the good to excellent category.
• According to the ag ministry, Ukraine is estimated to have shipped about 700,000 mt of ag goods through the humanitarian corridor since it was opened. Officials believe that it is possible, however, to transport between 2.0-2.5 mmt per month on those shipping lanes. Grain also continues to leave the country via the Danube River.
• Matif wheat futures closed in the red for the third time in the past four sessions. This pressured the US market today, as did the US Dollar Index, making a big move higher. As of this writing, the dollar is up 0.75 at 106.28. This historically high level does not help the export market, especially as Russian wheat offers are still said to be dirt cheap around $235 per mt.
• Consultancy group, APK-Inform, reduced their estimate of Ukraine’s grain harvest to 53.4 mmt versus 54.2 previously. The wheat output forecast was unchanged at 21.5 mmt, so the revision came down to a lower corn harvest projection.
• There continues to be talk that China is looking to purchase more US wheat, though there have not been any announced sales over the reportable level of 100,000 mt. However, there is some chatter that China will try to stimulate their economy – if true this could lead to more import demand for commodities.

DAIRY HIGHLIGHTS:

• Spot cheese remains mixed for the second session with blocks falling 2.25 cents, while barrels were unchanged. It seems the market is still waiting for the holiday rally despite reports from cheesemakers that demand has been steady to increased.
• Class III futures pulled back again on the day, led by the December contract which traded 33 cents lower to close at $17.56/cwt. 
• Spot butter lost a penny on 3 loads traded to end at $3.3650/lb. The recently strong powder market backed off by 2 cents on 5 loads traded to close at $1.2200/lb.
• Class IV futures also fell slightly on the day on light volume and weaker spot trading for products.
• Cattle futures started the morning down as much as $4-$6.75 before rebounding to capture most of those losses. December futures closed back in the green at $178.625/cwt.

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Author

Amanda Brill