CORN HIGHLIGHTS:
- Corn futures finished higher for the third consecutive day but ran into resistance at the 420 level in December corn. Options expiration, improved demand, and strong gulf basis bids helped support the corn market as we moved into the back half of harvest.
- On Friday, November grain options expire. Although there is no November futures contract for corn, the market does have short-term November options that expire on Friday. The largest area of open interest for November corn options is at the 420 level, and prices have moved into this range, which could introduce additional volatility as option expiration approaches.
- The USDA announced a flash export sale of corn this morning. Exporters sold 100,000 mt (3.9 mb) to unknow destinations for the current marketing year. This was the sixth consecutive day of an announced export sale for corn.
- The USDA will release weekly export sales on Thursday morning. The market is expecting a strong sales total for last week. Expectations are for 2.2 – 3.3 mmt of new sales. A large portion of these sales totals are known given the daily sales announcements by the USDA.
- Weekly ethanol production remains strong, pushing to 1.081 mb/day last week, up from the week prior and 4% above last year. A total of 108.7 mb of corn was used last week in ethanol production, with the current usage pace ahead of the USDA target for the marketing year.
SOYBEAN HIGHLIGHTS:
- Soybeans closed higher for the third straight session, with the November contract leading the way, while the deferred contracts trailed. As November options expiration approaches on Friday, there is substantial open interest at the $10 strike. However, the November contract has yet to rally above the $10.00 mark, since prices tend to gravitate toward strikes with large open interest.
- Trading in the soybean complex was interesting today, as both soybean meal and oil traded lower, while soybeans themselves closed higher. Yesterday, soybean oil gained over 3%, providing clear support for soybeans. Since the beginning of the month, soybean meal has moved inversely to soybeans, losing $27.10 so far.
- This morning, the USDA reported two flash sales by private exporters. The first sale was for 130,000 metric tons of soybeans to be delivered to China during the 24/25 marketing year, while the second was for 259,000 metric tons to unknown destinations, also for delivery during the 24/25 marketing year. Overall, export sales have been supportive over the past week.
- In Brazil, 18% of the soybean crop is now planted, compared to 8% last week and 30% at this time last year. Most of the country received rain last week, and the forecast for this week predicts 1 to 4 inches of rain in central Brazil. The season had a rocky start due to extremely dry conditions but has since shown signs of recovery.
WHEAT HIGHLIGHTS:
- Wheat closed in mixed fashion with small gains for Chicago, small losses for Kansas City, and was mixed for Minneapolis as the deferred months gained on the front. Matif wheat had a similar story with a 0.25 Euro rally in the December front month, but losses of 0.25 to 0.50 Euros in the deferred contracts. US wheat finished the session relatively strong, considering that the US Dollar Index scored a fresh near-term high above the 104.50 barrier.
- India’s cash wheat price is said to have hit the equivalent of $9.59 per bushel, which is a new season high. This continues to reinforce the idea that their nation may need to import wheat, which offers a bullish tone to the marketplace.
- At a BRICS summit, Vladimir Putin reportedly proposed once again the creation of a new grain exchange for these countries. The idea is based on the premise that it would allow for fair price discovery, become a predictable price indicator, and assist in ensuring global food security. Putin added that the exchange could later include other commodities, such as energy and metals.
DAIRY HIGHLIGHTS:
- Class III futures after trading lower for much of the morning, reversed to close higher and ending a three-day losing streak.
- November Class III futures traded at their lowest level since August 6th before reversing higher to close at $20.40.
- Spot cheese improved 1.3750 cents to close at $1.91375/lb. Whey was unchanged for the fourth day in a row at $0.6025/lb.
- Class IV was yet again on the defensive as spot butter slipped for a second straight day. Heavy trading volume in Q1 2025 contracts pushed prices lower.
- Spot butter fell 2.25 cents to $2.6550/lb while powder was unchanged at $1.36/lb.
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