- HEADLINES: Chicago wheat recovery flounders; Crude stays Weak; Fresh input lacking
- US wheat futures were unable to sustain early morning gains and otherwise world ag markets have done little at midday. Weakness in crude acts as a wet blanket on the ag space, and enthusiasm for new positions ahead of next Tuesday’s US election is lacking. Lingering in the background is an outright wet forecast in central and northern Brazil and the growing likelihood that drought in the US is eased across the far E Plains, Midwest, and mid-South. The midday GFS weather forecast is more expansive with rainfall of 1-3” next week, and this rain is projected to be spread across the E Plains and entirety of the Midwest, TN, and KY .
- US exporters this morning sold 244,000 mt of corn to Japan and unknown destinations. No soybean sales were announced.
- US corn inspected for export in the week ending Oct 24 totalled 32 million bu, vs. 39 million the previous week and vs. 22 million in the same week a year ago. Soybean inspections totalled 88 million bu, vs. 94 million the previous week and vs. 75 million a year ago, though we do note that the US’s soy export program very often peaks between mid- and late October.
- Wheat inspections totalled just 9 million bu, vs. 10 million the previous week.
- For their respective marketing years to date, the US has inspected for export 261 million bu of corn, up 33% year-on-year, 382 million bu of soybeans, up 2%, and 349 million bu of wheat, up 34% from late Oct 2023. Pace analysis implies USDA will leave its corn, wheat, and soy export forecasts unchanged in its November WASDE, but the rate at which soy sales/shipments decline must be watched closely. Our concern is that US soy exports will be trimmed 25-75 million bu after January barring adverse Brazilian weather.
- Russian wheat fob quotes are down slightly again, with spot wheat buyable at/below $235/mt. The wheat market, including within Russia, has shrugged off the government’s recommended floor price of $250/mt for hi-pro milling sales, but an Egyptian tender is really needed to judge just exactly where Russian wheat fits into the global marketplace for delivery in December and beyond. EU, US, and Australian markets recently have been left to wait for price movement in Russia, and for now must battle for non-traditional export demand. Russian wheat exports are expected to end October at 5.4-5.5 million mt, a record for the month. E Australia’s spot wheat futures are down $0.03/bu at $5.84, a newer 8-week low.
- WTI crude is stuck down $4.00/barrel at $67.70. Key support lies at $66.30. The Dow at midday is up 270 points.
- The GFS weather forecast in S America is drier in N Argentina, but wetter in Buenos Aires and wetter in Mato Grosso. A rather normal S American climate is forecast through the first full week of November. We note there remains doubt in the climate community with regard to the speed of La Niña development, and for now cooler than normal equatorial Pacific temperatures don’t appear to be negatively impacting conditions in Argentina and far Southern Brazil. Extreme heat stays absent into Nov 12.
- Chicago corn and wheat’s recent failure at chart-based resistance is noted, and Jan soybean’s lacklustre performance at its 20-day moving are noteworthy. We do note wheat and soy are again approaching oversold technical conditions.