CORN HIGHLIGHTS:

• Corn futures ended the day higher after a day of choppy trade that saw prices on either side of unchanged. A flash sale to Mexico, good export inspections, and the prospect of delayed Brazilian corn plantings were all supportive today.
• This morning, the USDA reported private export sales of 104,000 mt of corn for delivery to Mexico during the 23/24 marketing year. Export sales are currently running 33% above a year ago, with Mexico being the primary buyer.
• US weekly export inspections were released this morning and showed total corn inspections for 23/24 at 268 mb which is up 24% from the previous year. US corn is currently the cheapest feed grain available in the world right now, and this is allowing the USDA to estimate the 23/24 season’s corn exports 22% higher than last year’s.
• Brazilian soybean planting is quite behind for this time of year due to the extremely hot temperatures and dryness, and although they are slated to receive rain over the next week, some of the crop will be replanted which would delay their planting of safrinha corn. There have been reports that seed sales in Brazil are below expectations for corn.

SOYBEAN HIGHLIGHTS:

• Soybeans moved sharply higher today along with both soybean meal and oil. The election of Javier Milei as president in Argentina is having a temporarily bullish effect on prices as farmers may likely hold off on sales until Milei is sworn in on December 10. Technically, soybeans achieved a bullish key reversal today.
• With Argentina facing inflation above 140%, Milei has said he would move the country’s currency to the US dollar, as well as make sharp cuts in export taxes for agricultural goods. While this may be bearish in the long term, many farmers will presumably wait to sell cash grains until these tax cuts are in place.
• China has been a main buyer of US soybeans lately, but they have been buying from Brazil in bulk as well. October soy imports from Brazil to China were reported to be up 71% from last year to a whopping 4.8 mmt, while US soy exports to China for October were just over 228,000 mt.
• While non-commercials continue to hold net short positions in both corn and wheat, they have been growing their long soybean position. As of November 14, funds increased their net long position by 19,315 contracts to 87,913 contracts, they also hold a large net long position of 131,000 contracts in soybean meal.

WHEAT HIGHLIGHTS:

• The wheat complex started the holiday week continuing last week’s slide lower with all three classes closing lower on the day and KC printing its lowest price since July ’21.
• The USDA released its weekly export inspections report today with a total of 13 mb of wheat inspected for export. The total was not only in line with trade expectations, it also met the average weekly total needed to reach the USDA’s current export goal.
• Low export prices out of Russia are nothing new and continue to weigh on the US export pace and prices. IKAR reported that Russian export prices remained steady at $230/mt FOB last week, while SovEcon reported that last week’s Russian grain exports dropped 9% from the previous week and totaled 810k mt.
• Though there is nothing confirmed, there has been talk of another attempt at a sanctioned grain export corridor for Ukraine that could increase their exports and lower insurance costs. So far, the Ukrainian Danube River corridor is working, with the river ports handling 27.6 mmt in the first 10 months of the year.
• Wet weather in southern Brazil is not just affecting corn and soybeans. Conab lowered its estimate for Brazil’s wheat crop to 9.63 mmt, down 7.9% from October’s estimate and 8.7% less than last year’s 10.55 mmt record crop.

DAIRY HIGHLIGHTS:

• The US spot cheese block/barrel average finished Monday at its lowest level since July 19, 2023, as the block/barrel average fell another 2.50c to $1.5550/lb.
• The cheese market has turned south once again as a lack of demand is weighing on the market. The window for a holiday rally has all but closed from this point on.
• Class III futures responded to the new low for cheese with nearby contracts hitting new contract lows. By close, December 2023 dropped 26c to $16.38.
• A 2.75c higher bid in the butter trade helped to support the Class IV market, but the weakness in Class III may have been enough to keep the market red on Monday.
• After the market closed, the USDA released its October milk production report that showed that milk production declined year-over-year for the fourth month in a row.

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Author

Amanda Brill