Corn is trading higher at midday with support coming from the wheat complex as global weather issues drive prices higher. December corn closed above 5 dollars yesterday for the first time in over two months.
There have been rumors of China looking to buy US corn out of the PNW despite Ukrainian offers that are cheaper, but shipping issues could be the reason that China is looking to the US.
Israel sent more rockets into Gaza last night as war and tension in the Middle East continues to ramp up with crude oil having a higher yet relatively mild reaction to the fighting.
The EIA reported that ethanol production and blending demand are both higher for the week with ethanol production at the highest levels in over a month, indicating strong demand.
Soybeans are slightly lower but have come back from their early morning lows which saw November futures down as much as 9 cents. Soybean meal is lower, while soybean oil is higher along with crude.
Exports are still behind last year but are picking up, with last week’s sales a marketing year high at 50 mb. China has been a buyer with another sale of 4.85 mb announced yesterday.
Soybean meal has trended higher after the drought last season that severely cut Argentina’s soybean meal production and caused US exports of meal to increase significantly.
Some analysts are estimating that Brazil will produce another massive soybean crop this year with guesses between 162-164 mmt, but so far the weather has been too dry, causing planting to be delayed, and the overall weather pattern doesn’t look great at this point.
Wheat is leading the grain complex today, offering support to corn as major wheat producing countries deal with adverse weather that could impact global supplies.
Rumors continue to circulate that China is purchasing more soft red wheat from the US which could be true considering that Ukraine is having difficulty exporting, and that China has been a more active buyer of both US corn and soybeans.
The Brazilian 23/24 wheat crop is seen at just 10.5 mmt, down 5.9% from the previous estimate due to dryness. Argentina’s wheat crop is now rated 47% poor to very poor due to drought, up 5 points from last week.
The Australian wheat crop is expected to fall by 40% to 45% this year due to drought, and India’s production is expected to fall as well, which may cause them to become a net importer.
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