CORN HIGHLIGHTS:

• The corn market shrugged off Friday’s weakness as it refocused on the friendly numbers in Friday’s USDA report. December corn settled back above the 20-day moving average, with additional strength gained from another flash sale to Mexico and a higher wheat market.
• On Friday’s Commitment of Traders report, managed money was holding a net short position of nearly 170,000 contracts, after selling just under 24,000. This was one of the largest short positions since late 2020.
• In a flash sale reported this morning by the USDA, Mexico stepped up to the plate again and purchased 210,000 mt (8 mb) of corn for the 23/24 marketing season. While exports remain sluggish overall, Mexico has been a main buyer.
• Weekly corn export inspections for the week ending Thursday, September 28, came in lower than the previous week at 626,000 mt, mid-range of what was expected by the trade, and still behind the export pace needed to reach the USDA’s target of 2.050 bb for the 23/24 season.
• Corn had a surprisingly negative reaction to Friday’s report, which showed September 1 stocks at 1.361 billion bushels, which was 78 mb below the September WASDE and 91 mb below last year’s stocks.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day slightly higher after beginning the day lower on the heels of the quarterly Stocks report, which saw prices fall sharply on Friday. Soybean meal ended the day lower, but support came from significantly higher soybean oil.
• On Friday’s report, stocks were seen at 268 mb versus an expected 242 mb. This number still leaves stocks very tight, but was enough to cause funds to ramp up selling. Stocks are expected to remain tight as analysts begin to call yields closer to 49 bpa compared to the USDA’s guess of 50.1 bpa.
• A sale of 132,000 metric tons of soybeans was reported for delivery to China for the 23/24 marketing year. In addition to this, weekly inspections for soybeans came in at the higher end of expectations at 663,335 mt.
• The weekly Crop Progress report will be released later this afternoon and it is expected to show harvest between 26% and 28% complete, with both harvest and maturity ahead of the 5-year average. Conditions are expected to be called steady with most of the crop matured.

WHEAT HIGHLIGHTS:

• Wheat saw quite a comeback today after the negative close on Friday. The Chicago contract in particular posted double digit gains all the way out to May of 2025. This is also despite a new near-term high in the U.S. dollar, and negative close in Matif futures, which lost three Euros on the front month December contract.
• Weekly wheat export inspections for the week ending September 28 came in at 14.6 mb and bring the total 23/24 inspections number to 233 mb. So far, inspections are running behind the pace needed to meet the USDA’s export goal of 700 mb.
• While it is not fresh news, fundamental support may be coming from weather issues in other wheat growing regions of the world. Australia in particular is struggling with heat and dryness, with some analysts predicting a 30%-40% decline in their crop production.
• According to the Deputy Prime Minister of Ukraine, an additional five cargo ships are headed to Ukrainian ports to load with grain for export. Reportedly, about 120,000 mt of grain will be destined for Africa and Europe. In other Black Sea news, as reported by Interfax, Russia will increase their wheat export tax to 4,565 Rubles per ton, the equivalent of about $46.85.
• There was not much news to cause today’s rally, indicating that it was likely technical in nature. After Friday’s washout, wheat was quite oversold on some contracts and in need of a bounce. The question is, can this rally be sustained? Friday’s data painted a negative picture, that if true, could continue to pressure the market.

DAIRY HIGHLIGHTS:

• Cheddar barrels were up 6.25 cents in today’s trade to bring the overall spot cheese trade to $1.63125/lb. Spot barrels still sit 17.75 cents under blocks.
• Nearby Class III futures held modest gains with the October contract closing at $17.01. The 2024 average closed at $18.33.
• Class IV contracts saw October and November futures close 20 cents higher while most deferred contracts were quiet.
• Spot butter hit a new all-time high at $3.34/lb by gaining 4 cents from Friday while powder was unchanged at $1.1850/lb.
• A government shutdown was avoided (at least for now) late Saturday night as funding agreements were signed.

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Author

Amanda Brill