CORN HIGHLIGHTS:

• An overall weak tone in the commodity space helped push corn futures lower, testing last week’s price low at $4.68 for December futures. December corn lost 8 ¾ cents on the day and established its new lowest close since September 2021. The weak price action and selling pressure have December corn poised to challenge or establish a new September low.
• Corn harvest continues to move along ahead of schedule. The USDA Crop Progress report posted that corn harvest was at 81% harvested versus the 5-year average of 77%. The northern corn producing states are showing the biggest delays due to wet weather.
• The strong pace of harvest has increased harvest pressure as fresh bushels are in the pipeline. Talk of improved yields in the last half of harvested has limited the corn market’s upside potential.
• On November 9, the USDA will release the next Crop Production 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. The corn market may likely be pricing in potential negative news.
• South American weather is still a focus of the market at this time. Current weather is likely more supportive of the soybean market, but potential delays or loss of production in the second crop corn in Brazil could support corn prices in the late summer with possible improved late season demand.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day lower apart from the November contract which held onto some of its gains in thin delivery cycle trade. This followed an impressive start to the day where all the contract months were solidly higher thanks to big gains in soybean meal, but technical resistance, the selloff in meal from the highs, and a drop in crude oil caused prices to fade.
• Crop progress saw the soybean harvest at 91% complete, slightly below the average trade guess, but still above the 5-year average of 86%. The main soybean producing states are closer to 95% complete, and the 7-day forecast for the central US remains dry and favorable to wrap up harvest.
• On Thursday, the USDA will release its WASDE report, and it will be revealed how much yields are lowered (if at all). The average trade guess is that yields will be decreased by 0.1 bpa which would have a minimal impact on ending stocks unless export demand is adjusted.
• Some bearish influence came from negative economic data from China today. While total Chinese imports were within expectations, total Chinese exports fell by 6.4% for the month of October which was much more than anticipated and caused some concerns regarding crude oil demand. Crude oil fell by over 3.50 a barrel today following the news.

WHEAT HIGHLIGHTS:

• Early gains faded into a risk-off session with lower closes in corn, soybeans, soybean oil, oats, wheat, and cattle. At the time of writing, metals and energies are also sharply lower. It is possible that in the grain markets there is some positioning going on ahead of Thursday’s WASDE report, but the bigger factor may be recent bearish economic news out of China.
• The wheat export inspections data yesterday at 2.6 mb was an all-time low for this time of year with records going back to 1983. This is in part due to Russia continuing to dominate on the export front. To make matters worse, the USDA could raise the Russian crop up from 85 mmt on this week’s report if Russia’s claims of a 93 mmt crop are to be believed.
• According to the USDA, 90% of the winter wheat crop is planted, which is 1% above average but 1% below last year. Emergence is at 75%, and the crop is rated 50% good to excellent, up 3% from last week. For reference, last year at this time the crop was rated 30% good to excellent.
• According to their agriculture ministry, Ukraine has left their estimate of the winter wheat planted area for the 2024 harvest unchanged at 4.36 million hectares, down from 4.46 million in 2023. As of November 6th, 3.87 million hectares or 88.8% of that area has been planted.

DAIRY HIGHLIGHTS:

• Spot butter fell 11.25 cents today to close at $2.8975/lb, under the $3.00/lb mark for the first time since September 21st.
• Class IV futures did not see much action today with December down a penny and January up 6 cents.
• Spot cheese fell 1.875 cents today to close at $1.62125/lb, its lowest level in more than a month. Spot whey was unchanged at $0.3850/lb.
• Class III contracts were weaker on the poor spot trade once again. December futures fell 24 cents to $16.87 while the 2024 Class III average dropped 7 cents to $18.27.

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Author

Brandon Doherty