CORN HIGHLIGHTS:

• After posting new lows for the recent move, corn futures found some buying strength and prices reversed off session lows. March corn futures gained 2 ¼ cents on the session. The turn higher in prices marked a bullish reversal on corn charts, which could lead to some additional buying strength in upcoming sessions.
• The First Notice Day for December corn is tomorrow November 30, and that may have added to the selling pressure in the December contract since the holder of long corn contracts needs to exit those positions or risk the prospects of delivery.
• Ethanol production slipped to 1,011,000 barrels per day last week, down slightly from last week and last year. Ethanol stocks slipped to 21.4 million barrels. Total corn used last week was estimated at 100.6 mb. For the marketing year, corn used for ethanol production reached 1.238 billion bushels, up 32 mb from last year or 2.7%
• USDA will release weekly exports sales on Thursday morning. Total new sales for corn are expected to range from 600,000 – 1,200,000 mt for last week. Overall corn export sales have improved but are still below the pace needed to meet USDA targets.
• The weaker corn price and strong premiums for Brazil and Argentina corn can improve the prospects of more corn export business for the US. A strong Brazilian real versus the US dollar will also be a contributing factor to possible improved sale pace.

SOYBEAN HIGHLIGHTS:

• Soybeans traded both sides of unchanged today but ultimately ended the day mixed with the front months slightly higher and the November ‘24 contract slightly lower. Both soybean meal and oil ended the day lower with meal under pressure from expectations of a normal Argentinian harvest.
• After last year’s drought in Argentina, soybean production was severely cut which caused the normally number one exporter of soybean meal to run short on supplies. As a result, the US picked up a lot of that business, but now Argentina weather is looking favorable for this year’s soybean crop and could cause US meal prices to fall sharply.
• In Brazil, weather is expected to improve over the next seven days with better chances for rain in central and northern Brazil and decreased chances in rain-soaked southern Brazil. The country is reportedly 8 to 10 days behind its normal pace of planting, but the worst of the El Nino pattern may be over.
• While US exports have improved over the past few months, total export sales are still 20% behind year ago levels as we compete with last year’s record Brazilian harvest and cheaper prices. Meanwhile, domestic demand has been firm with profitable crush margins.

WHEAT HIGHLIGHTS:

• All three US wheat futures classes closed higher with Kansas City leading the way. Support came from higher Matif futures, as well as correction from oversold conditions. There were also reports that heavy rain in southeastern Australia contributed to crop damage. This headline offered support to prices, with talk that their production may decline by 100,000 mt, and 1 mmt of wheat may be downgraded to feed.
• Also supportive to wheat is the fact that Russian wheat values have moved higher, putting US and French soft wheat back on the playfield (in terms of the export market). Whether or not this will last is the question though; Russia’s ag minister stated that with 98% of the crop harvested, 99 mmt of wheat has been collected which would be the second largest crop on record.
• According to SovEcon, the 2024 Russian wheat crop is estimated to fall to 89.8 mmt, versus 91.5 previously, due to expectations for declining conditions and poorer yields. A crop this size would still be above average, however, and Russia is likely to remain dominant on the export front.
• India has announced a $142 billion plan to extend a free food program for 800 million people. The five year program extension will allow recipients to get five kilograms of rice or wheat per month. The extension will begin January 1st and is intended to help consumers face high internal food costs.
• The US Dollar, while on both sides of unchanged today, has been in an overall downtrend. This may have also offered support to wheat and the grain complex today. Traders will await any news from the Federal Reserve regarding further interest rate increases versus pausing the hikes, which will have continued impact on the US Dollar index.

DAIRY HIGHLIGHTS:

• January 2024 Class IV milk is in the midst of a three-day up streak in which the contract has added 60c over that stretch.
• The market is reacting to a positive turn in the spot butter trade. Butter has added 12.25c over the past two sessions and it appears buyers are back after a near $1.00 drop from the high.
• The bounce in Class IV has had little effect on Class III, which continues to hit new lows. The 2024 Class III average has finished lower eight days in a row.
• Front month butter futures jumped 7c on the day up to a $2.64/lb close.
• There has been little demand for the cheese trade despite the market at multi-month lows near $1.50/lb.

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Author

Brandon Doherty