CORN HIGHLIGHTS:

• The corn market traded higher to end the week, supported by strength in the soybean market. Friday’s higher trade ended a 5-session selling streak in the corn market as December corn closed 1 ½ cents higher. Despite being higher on Friday, Dec corn lost 14 ¾ cents for the week and posted its lowest weekly close in a month.
• Overall, a quiet news day for the corn market. Prices were supported by strong soybean and soybean meal prices, a higher crude oil market, which helped trigger some end of week profit taking of short positions. Nearby resistance over the December contract is at $4.85, and trading below leaves open the greater possibility of lower trade.
• Corn has seen an uptick in demand, which can support the market. Cash basis has firmed as the US moves into the second half of harvest, ethanol margins remain supportive, and export sales this week were above expectations at 53.2 mb. The market will be watching to see if an improving demand will be a trend.
• South American weather is forecasted to stay dry and hot for areas of Brazil, and areas of Argentina are seeing signs of last year’s drought persist. While South American weather is still in its early stages, weather will grow more in importance in the weeks ahead.
• Last week, managed money funds were reported as net short 108,000 corn contracts, and that position likely grew this week. Global and US corn supplies are still heavy, and funds will still need a reason to want to exit those short positions.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day higher following significant gains from soybean meal and oil. The bulk of the bullish news came earlier in the week, but soybeans had not been able to break out of this week’s tight range. For the week, November soybeans lost 5 cents, December meal gained $18.50, making new contract highs, and December soybean oil lost 1.12 cents.
• Soy products were behind today’s rally in soybeans, with soybean meal posting contract highs. Soybean meal exports have climbed as the US has been able to pick up Argentinian business. Soybean oil moved higher along with crude oil, and the gains in both products have greatly improved crush margins, helping demand.
• Yesterday, export sales were announced with increases of 50.6 mb for 23/24, and export shipments far above expectations at 87.6 mb. Along with that positive news, two sales of soybeans were reported to China for a total of 232,000 for 23/24. The renewed interest from China in US soybean purchases has been encouraging, and the purchasing agreement signed earlier in the week instilled more confidence.
• Weather in South America has not improved much with only slight showers in Argentina that helped some key wheat areas. Northern Brazil is dry and is forecast to remain that way, while southern Brazil is too wet with parts of it flooding. Producers in both regions are beginning to replant soybeans as a result.

WHEAT HIGHLIGHTS:

• Despite corn and soybeans finishing the session on a positive note, wheat could not do the same and posted losses in all three US futures classes. Yesterday’s reports that Ukraine temporarily suspended their humanitarian corridor later were denied, and the shipping lanes are still open. In fact, four vessels were reported to have left today with an additional 23 loading. This is likely the main culprit that pressured wheat today.
• In addition to the above point, recent rains in the US southern Plains may have also burdened wheat futures. With the first winter wheat crop ratings due for release on Monday, the trade is looking for conditions to come in around 50% good to excellent. If that is accurate, it would be the highest rating for this time of year since 2019.
• On a bullish note, there is still talk that India may eventually need to import wheat due to rising prices and inflation. Reportedly, their government has plans to sell more wheat from their reserves to help alleviate rising costs. They are said to be ready to sell 300,000 mt, which is up from 200,000 mt previously.
• Argentina’s wheat crop is reported to be 6.8% harvested, according to the Buenos Aires Grain Exchange. Recent rains there were significant and have helped to stabilize the crop. The BAGE also said that 54% of the planted area now has sufficient, or even optimal moisture, versus only 8% the previous week.
• The EU slightly increased their estimate of the soft wheat harvest to 125.5 mmt, up from the 125.3 mmt estimate in September. However, exports were reduced by 1 mmt to 31 mmt. The European Commission also increased their carryout estimate to 19.1 mmt vs 17.8 mmt last month.
• The EU slightly increased their estimate of the soft wheat harvest to 125.5 mmt, up from the 125.3 mmt estimate in September. However, exports were reduced by 1 mmt to 31 mmt. The European Commission also increased their carryout estimate to 19.1 mmt vs 17.8 mmt last month.

DAIRY HIGHLIGHTS:

• Spot cheese was unchanged on the day with no loads traded. Blocks finished the week at $1.73/lb while barrels closed at $1.6825/lb. Spot whey closed out half a penny higher going home at $0.40/lb on 8 loads traded.
• Class III futures were weaker with the February contract losing 17 cents to close at $17.91/cwt. Class III really struggled this week on poor cheese demand and spot trading. 
• Spot butter lost another 5.75 cents on the session going home at $3.1925/lb. Spot powder was unchanged on the day closing at $1.1975/lb.
• Class IV continued its struggle on Friday dropping 50 cents on the December contract to close at $19.49/cwt. Class IV has now seen a decrease of 67 cents on the December contract over the previous week at the time of this writing.
• Cattle futures bounced back heading into the weekend to close back above the 50-day moving average at $184.00/cwt.

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Author

Amanda Brill