CORN HIGHLIGHTS:

• Corn futures saw additional corrective action on Thursday and December futures gained 4 ¼ cents. Prices are likely adding some slight weather premium with a hotter and drier forecast going into next week, but some light technical buying occurred as price action was friendly most of the session.
• The corn market remains oversold, but still slightly lower on the week. Friday’s close could be key to establishing a possible short-term trend change.
• USDA released weekly export sales this morning. For last week, the USDA reported an increase of 9.2 million bushels of corn export sales for the 2022-23 marketing year and an increase of 27.7 mb for 2023-24 marketing year. Both numbers fell within analysts’ expectations. Last week’s export shipments of 17.5 mb were below the 22.9 mb needed each week to achieve USDA’s export estimate of 1.625 bb in 2022-23.
• Grain markets were limited by continuing strength in the US Dollar Index. The dollar is trending higher, attempting to push through key resistance levels. The U.S. dollar index is trading at its highest level since July 6.
• NOAA and the Climate Prediction Center released long-range forecasts for the fall months. Weather models are overall looking non-threatening with rainfall and temperature forecast to stay relatively normal during the period.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day higher again today with primary support from gains in soybean oil while soybean meal closed lower. The hot and dry 8 to 14-day forecast has been supportive on concerns that yields may be negatively impacted.
• Soybean oil prices are getting a boost from higher palm oil on talk of increased imports from India, helping to firm soybean oil’s percent of crush value to 6-month highs, while also adding support to soybeans.
• This morning, the USDA reported 3.4 mb of export sales for old crop soybeans which was down 42% from the prior 4-week average. 51.7 mb of new crop sales were reported, and shipments were 16 mb. 30 mb more of soybeans need to be shipped within the next 3 weeks to meet the USDA’s estimates.
• Brazilian food and fuel processor Caramuru Alimentos has started selling soybean-based ethanol at one of its plants in Brazil. This would be one of the first companies to produce at scale and sell ethanol made from soy molasses.

WHEAT HIGHLIGHTS:

• All three US wheat futures classes posted losses in tandem with Paris milling wheat futures. The US Dollar Index continued the trend higher today, keeping pressure on wheat.
• The USDA reported an increase of 13.2 mb of wheat export sales for 23/24. While not a terrible number, it was not enough to get traders excited. Shipments are also behind the pace needed to meet the USDA’s export goal of 700 mb.
• There is talk that Russia and India may be nearing an agreement on an import deal for wheat. However, India’s inflation came out at 7.4% (vs 4.8% in June), which could ultimately limit their import demand.
• Consultancy group, APK-Inform, raised their estimate of the Ukraine 2023 grain harvest to 53.1 mmt, and includes 20.6 mmt of wheat. It is also believed that Ukraine will be able to export 12 mmt of wheat.
• According to StoneX, Brazil’s 23/24 wheat crop could come in at 11.19 mmt, which is 2.3% lower than the July estimate. This could be due to lower planted acreage in Rio Grande Do Sul.

DAIRY HIGHLIGHTS:

• Spot butter saw 25 more loads of product trade on Thursday, taking the price up another 2c to $2.77/lb. Over the past two sessions, a whopping 74 loads traded.
• Despite a weak powder market, the strength in butter is aiding Class IV futures. Second month Class IV rallied 20c to a $19.25 close.
• The Class III market just can’t seem to get anything going for it. The market was pressured lower Thursday from an 8.50c lower offer in barrel cheese.
• Powder caught a bid and had a rare up day. The market price recovered a penny to $1.0950/lb.
• The USDA will release its July Milk Production report next week Monday. The market will watch to see if cow numbers continue to decline and whether production will grow or contract.

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Author

John Heinberg