Weekly Recap September 27, 2019

Harvesting Soybeans

On Friday, December corn closed down 1 at $3.71 1/2, and that is up 3/4 of a cent for the week. 

November soybeans closed down 5 1/2 today at $8.83, but that is up 1/4 for the week. 

There really wasn’t one big over-riding story this week affecting the grain markets. Mostly, we dealt with continued harvest delays and a forecast calling for more rain as well as a story or two about the ongoing U.S./China negotiations about trade. 

We did take a look at fund positions earlier this week, but that was kind of a mixed bag as well. As of last Tuesday, the short in corn, due to managed money, increased by 34,000 contracts to more than 170,000 contracts short. For soybeans, the fund position was reduced by almost half, and stood at 48,000 contracts short. 

A few notes on corn: 

  • Ethanol production was reported at 277 million gallons last week, down from 295 million the week before. This is the lowest weekly production since April of 2016. 
  • Cash corn prices at Landus facilities is about 22-25 cents more than this time last year, and 35 cents or more higher than this time 2 years ago. 
    • Partly due to strong basis levels, but also higher futures. Both reflecting a delayed harvest to some degree. 
  • Export inspections were reported at 234,000 metric tons (9.2 million bushels) vs. an expectation of 400-700,000 mt. 

For soybeans:

  • Concerns continue about yield and over all crop size. The delayed harvest is causing some concerns, but not too much just yet. 
  • Both the U.S. and China have released statements that preliminary trade negotiations are going well. 
    • China supposedly bought some more cargoes this week for October – December shipment from the U.S.
  • Export inspections were better than expected at 923,000 metric tons, above the range of expectations of 600-900 mt. 
  • South Korea has now confirmed a 3rd case of African Swine Fever after their first one last week. 
  • South American weather has been good, with beneficial rains in the forecast for Brazil. 

On Monday, the USDA will release their quarterly stocks report, showing estimated inventories as of September 1st. So far, it doesn’t look like too many people expect any major surprises, but we will see what they say soon enough. 

For a little more in depth analysis of the week’s markets, please tune in to the Landus Cooperative Experience podcast, featuring the Bull Bear Banter. Listen in http://ow.ly/hXwE30pCAtu​​

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