CORN HIGHLIGHTS:

• Short covering and technical buying helped pull corn futures higher to end the week, as grain markets saw good money flow during Friday’s session. Overnight, December corn futures tested and held the September low and a strong break in the US dollar triggered fund short liquidation. Dec corn gained 7 ¼ cents on the day but was 3 ½ cents lower on the week.
• The US dollar broke over a full basis point lower on Friday as the move lower in the dollar was triggered by weakness in today’s employment report and a more dovish (friendly) tone by the Fed regarding interest rates going forward. The Dollar Index posted a weekly bearish reversal on charts, which could lead to additional long liquidation.
• Corn futures did post a technical reversal on daily charts during today’s session but failed at nearby overhead resistance. Trade early next week and the potential follow-through in price gains will be very key or sellers could take over the market again.
• Price gains in the corn market were limited by continued hedge pressure. With harvest moving into the last 15% to be completed, fresh supplies of better-than-expected yields in some areas are hitting the cash market.
• On November 9, the USDA will release the next crop production report. The market could be choppy next week with position squaring going into the report. Early expectations are for the USDA to slightly increase corn yield and production, which could add bushels back to an already heavy supply picture.

SOYBEAN HIGHLIGHTS:

• Soybeans closed firmly higher to end the week following strong gains yesterday, as well. The US dollar moved sharply lower which helped support the grain complex today. Soybean meal posted huge gains with the Jan contract up 4%. For the week, Nov soybeans gained 30-1/4, Dec meal lost 0.30, and Dec bean oil lost 2.91.
• This was a good week for export demand with a solid export inspections number, good export sales yesterday of 37.1 mb for 23/24, and huge shipments of 73.2 mb which were primarily to China. Today, private exporters also reported sales of 131,150 mt of soybeans for delivery to unknown destinations for the 23/24 year.
• US soybean yields are coming under more scrutiny as many producers report better than expected corn yields, but subpar soybean yields. StoneX recently revised their bean yield estimates lower than their last month’s guess, and next week the USDA will update their estimate in the WASDE report, which has the potential to be reduced.
• In Brazil, weather is still a concern with the 10-day forecast turning very dry again. Argentina has received some beneficial rains, but southern Brazil is still too wet. There have been reports in Brazil of producers recently tearing up planted soybeans in favor of cotton.

WHEAT HIGHLIGHTS:

• The US Dollar Index was sharply lower today. As of this writing, it is down 1.07 at 105.05; this is quite a dip and certainly helped the grain markets to rally today with strong gains in corn and wheat. Soybeans were the leader with more than 20-cent gains and helped to pull wheat higher too.
• All three US wheat futures classes could be considered at or near oversold levels, and with today’s move higher stochastics are indicating potential buy signals. If the rally can be sustained on Monday, a near-term bottom might be in.
• Also helping wheat today was a cut to the estimate of world wheat stocks by FAO-AMIS. For 23/24 the projection is now at 315.1 mmt vs 319.3 mmt last month. With the next USDA report due for release this upcoming Thursday, traders will have to wait and see if they make any sort of similar revision.
• While they have received recent rains that have benefited soil moisture levels, it hasn’t been enough to reverse the drought in Argentina. According to the Buenos Aires Grain Exchange, Argentina’s wheat crop is now forecasted down 4.9% to 15.4 mmt, vs 16.2 mmt previously. There could also be further cuts if the frost in the forecast is accurate.
• Rain in France is slowing fieldwork, and as of October 30^th, an estimated 62% of their soft wheat crop is planted. According to FranceAgriMer, that is down from both last year and the five-year average. The short-term forecast may call for more rain, causing continued delays.

DAIRY HIGHLIGHTS:

• Spot cheese was down hard on the day, losing over 3 cents in both block and barrels. Cheese lost a total of 5.375 cents over the week, which put some pressure on Class III Friday.
• Spot whey climbed another 1.50 cents on 19 loads traded. Despite good buying in the spot market, whey was down 1.25 cents from last week.
• Class III prices were pressured from poor spot cheese trading, giving back most of the gains made from yesterday’s session. Front month Class III futures finished out the week at $17.33/cwt.
• Spot butter continues to drop, losing another 1.25 cents to close at $3.1075/lb. There were an additional 3 loads of butter traded on Friday, but overall poor demand on the week. Spot Powder saw no changes on the day to finish out the week at $1.1850/lb.
• Class IV prices were mixed with many contracts going unchanged, while the December, March and May contracts all saw losses. Front month Class IV futures finished out the week at $20.75/cwt.

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Author

Brandon Doherty