CORN HIGHLIGHTS:

• Weak price action and harvest pressure keep the sellers in control in the corn market to start the week.  Dec corn established a new contract low, losing 4 ¾ cents on the session. The overall trend continues to be sideways to lower in the corn market.
• Harvest pressure will likely push on cash basis. Corn harvest was 5% complete last week and is expected to push to 10% complete on this week’s Crop Progress report. Weather forecasts overall are likely to support any ongoing harvest.
• Ethanol margins have remained strong, with softening corn prices. A strong crude oil market, challenging $92 a barrel on the session, will help support those margins. Ethanol production will likely stay supportive in the market.
• Weekly corn export inspections were at 642,000 mt (25.3 mb), which was within analyst expectations.  Year-to-date export inspections have totaled 1.267 mmt (50 mb), up 10% from last year, but still behind the required pace to reach USDA targets. The USDA is targeting total exports to 2.050 billion bushels, up 23% from last year.
• Manage Money funds have grown their net short position in the corn market to 134,909 contracts as of 9/12. Funds added nearly 41,000 combined short contracts last week, growing the position to one of the largest for this time of year in the last 5 years.

SOYBEAN HIGHLIGHTS:

• Despite a tight carryout and a flash sale today, harvest pressure, along with lower soybean oil and meal, pressed the soybean market, which ended significantly lower.
• Private exporters reported to the U.S. Department of Agriculture export sales totaling 123,000 metric tons of soybeans for delivery to China during the 2023/2024 marketing year, which began September 1.
• Crop progress will be released later this evening, and trade is expecting good to excellent ratings to fall 1 – 2 percentage points from last week on hot and dry weather. Some analysts are expecting ending soybean yields to come out below 49 bpa, which is below the USDA’s estimate of 50.1 bpa and could offer support to the market.
• Last week, November soybeans lost 22-3/4 cents and today, the contract fell below the 200-day moving average. Between September 5 – 12, non-commercials were sellers of 8,995 contracts, which reduced their net short position to 73,815 contracts.

WHEAT HIGHLIGHTS:

• Weekly inspections of 13.5 mb brought 23/24 total wheat inspections for export to 188 mb, down 29% from last year and below the pace needed to meet the USDA’s 700 mb export projection.
• Also pressuring wheat is news that two cargo ships made their way to Ukraine this weekend. Apparently, they will transport wheat out of Ukraine along the western coast of the Black Sea. News outlets are reporting that these are the first civilian vessels to make their way to a Ukrainian port since the end of the Black Sea export corridor.
• As El Nino strengthens, drought is expected to expand in Australia. According to the Australian Bureau of Meteorology, they are anticipating record breaking temperatures. Additionally, some private estimates of the Australian wheat crop are below 24 mmt versus the USDA’s 26 mmt figure.
• The roughly 1.6% drop in Matif wheat futures today did not lend any support to the U.S. markets.  From a technical standpoint, the 20-day moving average, currently around 608, is acting as resistance, and the market has not traded above that average since the beginning of August.
• While it is highly anticipated that the Federal Reserve will issue a pause on Wednesday, there is a small chance that they could also raise interest rates another 25 basis points due to inflation still being above their target level.

DAIRY HIGHLIGHTS:

• While cheddar blocks were unchanged, barrels fell 9 cents in today’s spot trade to drag down Class III milk.
• October and November Class III futures were down 30 and 31 cents, respectively.
• Class IV contracts were unchanged to higher despite a 5.25 cent jump in spot butter. Spot powder was unchanged.
• Milk production in August was down 0.20% YoY at 18.975 billion lbs. Cow numbers were down 16,000 head from August 2022 but unchanged from July.

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Author

Amanda Brill