- Early Chicago made today saw some fund short covering in wheat whilst corn and soybean futures ease on the coming US harvest pressure and improving S American weather.Volumes have been well down as fund managers appear reluctant to add to existing positions. It feels as if Chicago has made something of a top on Friday, and additional allies will face new selling pressure limiting upside in the short term.
- Australian fob wheat prices have fallen sharply to start the week on the rains that have fallen in the past ten days. The rains has stabilized the crop and in some cases, improved yield prospects.
- Jilin, China’s top corn growing province is cutting their subsidy for farmers to plant corn in 2018 by 13%. The subsidy for soybeans is far better (than corn), but high domestic corn prices may prevent much of a shift away from corn to soybeans next spring. It is rumored that China still has more than 180 million mt of old crop corn stocks (100 million larger than the WASDE forecast) that could be available to the market. The Chinese Government continues to prod its farmers to seed crops other than corn, it is soybeans that looks to be a logical switch. Also, the Chinese Government is reporting that its grain production will hold above 600 million mt, down from last year’s 616 million.
- US weekly soybean exports have to average closer to 100 million bu/week to reach the USDA annual forecasts into mid November. US corn and wheat exports are just abysmal. Research argues that a Chicago top was scored on Friday and that any bounce back will be a selling opportunity.