CORN HIGHLIGHTS:

• Selling pressure swept across grain markets to end the week, with soybeans and wheat posting double-digit losses. Corn showed relative resilience, finishing the session with a moderate decline. December corn lost 3 cents to 527 ½, and March corn lost 3 cents to 541 ½. For the week, December corn traded 2 ¾ cents lower, finishing lower for the second consecutive week.
• The U.S. Dollar Index has rallied higher for two consecutive weeks on thoughts of a U.S. interest rate hike at this week’s Fed meeting. The strong dollar, plus the elevated price for corn, has limited short-term rally potential on the export market.
• Brazil weather forecasts going into the end of the month are turning warmer and drier as the next planting season approaches. South American weather will be a larger focus as we move into October and November.
• Crude oil prices have cooled the latest rally, trading well off the highs for the week. The pause in the crude oil rally may have limited buying interest in the corn market.
• The corn market will be watching early harvest results to look for confirmation that this Fall’s corn crop is limited and below trendline yields. 

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day significantly lower due to a large move lower in soybean meal, along with lower crude oil. Much of this move likely came from profit taking ahead of the weekend and a lack of news regarding Iran and the U.S. November soybeans posted a lower high and lower low than yesterday but remain rangebound over the past two weeks.
• November soybeans lost 16-1/4 cents to $13.03-1/2 while March lost 16-1/4 cents to $13.29-1/2. Futures remain overbought but stochastics have begun to cross over into a sell signal. October soybean meal lost $14.10 to $354.60 and October soybean oil lost 0.98 cents to 67.70 cents. October crude oil is down $1.82 to $100.07 a barrel.
• In Malaysia, biodiesel consumption is expected to rise to 1.4 mmt this year which would be up from 1 million tons last year. They are the second largest producer of palm oil, and this may be a demand indicator for biofuel globally.
• For the week, November soybeans gained 7 cents while March gained 10-3/4 cents. October soybean meal gained $7.80 for the week, while October soybean oil lost 1.49 cents. After the Federal Reserve raised interest rates this week, the U.S. dollar rose sharply, which also likely weighed on prices towards the end of the week.

WHEAT HIGHLIGHTS:

• Wheat ended Friday’s session sharply lower across the board, pressured by the U.S. dollar reaching a one-and-a-half-month high this morning, along with improved production prospects in Western Australia and the potential for better weather in parts of the U.S. December Chicago wheat is down 13-1/2 cents at 7.13-1/2 while Kansas City December wheat is down 10-1/2 cents at 7.84.
• Wheat has been pressured during today’s session by improved prospects for rain across the U.S. Plains. Weather continues to play a factor, with U.S. winter wheat acres under drought conditions falling 2% this week to 57%. Spring wheat acres in drought declined 1% to 56%, while durum acres under drought also fell 1% to 39%.
• U.S. wheat exports are currently running 31% below the yearly average, compared with the USDA’s forecast of a 15% decline. The U.S. will need to see an uptick in export sales soon, or the USDA may need to lower its export forecast for the year.
• Tensions continue in the Black Sea export region and may have escalated overnight, with Russia and Ukraine both reporting attacks on each other’s assets. Russian wheat exports for September are down sharply, with only 2.7 MMT expected to ship, which would be the lowest level in 15 years. Ukraine’s exports are also facing disruptions following a Russian strike on a key bridge in Odesa that has helped facilitate shipments through an alternative route.

DAIRY HIGHLIGHTS:

• Cheddar blocks fell 7.25 cents today to drag down the block/barrel average 3.625 cents to $1.40125/lb, its lowest level since February.
• Class III futures followed suit with the second month October contract breaking 17 cents to $15.69.
• Butter gained 2.50 cents to to breakeven on the week while powder was up another 3 cents today for a total of 11 cents on the week.
• September and October Class IV futures closed green while the rest were either unchanged or slightly lower.

 Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of the National Futures Association. Stewart-Peterson Inc. is a publishing company. SP Risk Services LLC is an insurance agency. A customer may have relationships with all three companies. TFM Market Updates is a service of Stewart-Peterson Inc. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.

Author

Amanda Brill