Midwest weather looks mostly dry over the weekend with some shower activity in the forecast next week. Elsewhere, western Argentina is still dry, along with northern and central Brazil. This is despite the El Nino pattern, which usually brings a wetter pattern to South America.
There are rumors of Ukraine selling corn to China, however, this has not yet been confirmed.
There are some signs that China’s economy may be stabilizing, but Europe is still a concern as their economy still appears to be slowing.
Corn futures remain in a relatively narrow trading range as the trade waits for more news before pushing in one direction or the other. So far, December corn has held support around 473.
The U.S. soybean export commitment remains down 34% from last year.
Brazilian farmers are able to legally begin planting crops this weekend. There is some talk that soil may be too dry in Mato Grosso, however, it might be too wet in Parana and Rio Grande do Sul. Current projections for overall South American soybean production are expected to increase 30 mmt (given good weather).
NOPA crush data will be released this morning. The estimate for August crush is expected to come in around 168 to 169 mb.
Palm oil remains a drag on soybean oil. For the second consecutive week, palm oil posted losses and inventory is at a seven month high at 2.12 mmt.
Russia is exporting a record 5 mmt of wheat per month. The question is, will they be able to maintain that record pace? They continue to be the world’s cheapest origin and there are some private estimates suggesting their production could exceed 90 mmt.
Weather concerns for Argentina could mean more wheat production cuts in that region, as dry weather continues to cause issues. Recent rains resulted in Argentina’s crop condition improving by 6%, but only to 24% good to excellent. Additionally, October looks to remain mostly dry there.
As El Nino strengthens, Australian drought conditions are expanding. Like Argentina, Australia looks to remain largely dry through October and this could affect their wheat production too.
According to Stats Canada, their all wheat production estimate declined to 29.8 mmt versus 34 mmt last year due to drought. That is a 13% reduction year on year, with yields expected to be down 17.6% due to drought.
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