CORN HIGHLIGHTS:

• The corn market failed to follow through on Tuesday’s gains as prices consolidated in the middle of Tuesday’s trading range. Strength in the wheat market and announced export sales failed to trigger buying in the corn market.
• Rallies in the corn market are limited by producer selling pressure as September First Notice Day is Friday this week, and producers are likely pricing September basis contracts or moving old crop bushels. In addition, with the 3-day Labor Day weekend approaching, traders will likely square positions until the market opens next week.
• The USDA announced two flash sales of corn on the export market this morning. Columbia bought 100,000 mt (3.9 mb) and Mexico added 165,735 mt (6.5 mb) for the 24/25 marketing year. These sales are routine type business and failed to move the market. Currently, US corn export sales on the books for the 24/25 marketing year are the worst in the last 5-years.
• The USDA will announce weekly export sales on Thursday morning. With the 23/24 corn marketing year ending on Friday, the USDA expects old crop corn sales from –100,000 mt – 200,000 mt, and for the 24/25 marketing year, 700,000 mt – 1.4 mmt. The focus will be on the new crop sales as export business has been lackluster at this point.
• The overall trend in the corn market remains lower as the market digests the potentially large harvest, lackluster demand, and producers working through old crop bushels before harvest.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day lower, breaking a three-day streak of gains, with November soybeans now up 4 cents on the week. The market was pressured by better-than-expected overnight rains in key areas and a decline in soybean meal, although soybean oil ended slightly higher. Warmer weather is expected to accelerate crop maturity across most of the Corn Belt.
• This morning, the USDA confirmed an export sale totaling 264,000 metric tons of soybeans for delivery to China for the 24/25 marketing year. This was the first flash sale of the week and confirmed previous rumors of China needing to buy a significant number of soybeans before the end of the year.
• Yesterday, funds were estimated to have bought back approximately 2,000 soybean contracts. Funds currently hold an estimated net short position of about 183,000 soybean contracts, 87,000 soybean oil, and are long around 2,000 meal contracts. Funds are holding a near record short position in soybeans at the moment.
• In Indonesia, palm oil production is expected to fall by as much as 5% from last year due to adverse weather and ageing palm trees. The US has estimated that global palm oil reserves are headed for their lowest levels in three years, which could be supportive to world veg oil prices and US soybean oil.

WHEAT HIGHLIGHTS:

• In the face of a jump higher in the US Dollar and a lower close for corn and soybeans, all three US wheat classes posted gains today. Support came from a second consecutive higher close for Matif wheat futures; the September contract traded above the 10-day moving average for the first time since August 9, before closing just slightly below it.
• Statistics Canada has estimated Canada’s 2024 all wheat production at 34.4 mmt, which was below expectations for a 35.1 mmt crop. However, this is still above last year’s harvest of 32 mmt. The total spring wheat production estimate of 25.4 mmt makes up the majority of their crop, and was below expectations for 26.6 mmt.
• The USDA has determined that BioCeres Crop Solutions’ genetically modified wheat, known as HB4, does not require regulation. This drought-resistant variety, which is also herbicide-resistant, could soon enter the global market, having already received approval from Brazil, Argentina, and Paraguay. While HB4 could potentially increase wheat supply in the long term, and be bearish to prices, it may offer significant advantages in regions prone to drought.
• As of August 28, Russia has increased its export duty on wheat by 9.7%, raising it from 828.4 to 908.5 Rubles per metric ton. This duty will remain in effect until September 3. Russia introduced variable duties on corn, wheat, and barley in 2021, with the collected funds used to subsidize agricultural producers.
• Global weather conditions are raising concerns for wheat. In the US northern plains, ongoing rains that may continue through tomorrow could delay harvest and affect crop quality. In the Canadian prairies, strong winds from an approaching front this week could damage wheat crops. Additionally, recent widespread frosts in Argentina may have slowed wheat development or even caused damage.

DAIRY HIGHLIGHTS:

• September and October Class III futures finished down around 40 cents today, but did come off the late morning lows.
• Spot cheese kept up its crazy week by falling 9.50 cents today, but is still up 3.1250 cents on the week so far. Spot whey closed down 1.25 cents at $0.5525/lb.
• Spot butter was unchanged after hitting a new high for the move yesterday, while spot powder gave up a penny on 5 loads traded.
• On the Class IV side, September and December futures fell a penny while October and November were down more than 20 cents to move back under $23.00.

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Author

John Heinberg