- It has been a mixed and somewhat dull session, with markets unsure how to digest potential slowing of Russian wheat shipments and coming Central US rainfall. Corn and wheat sit near unchanged. Nov beans are down 3. Russia through the first days of October has exported a record 12.9 million mt of wheat, vs. 9.5 million a year ago. This reflects a sizable 37% of the USDA’s forecast and over 50% of the still-discussed government cap of 25 million mt. There are more questions than answers regarding near term Russian wheat exports, but we fully expect this issue to dominate newswires in the weeks ahead.
- Should weather forecast models verify, some 14” of rain will have fallen across IA in Sep and the first half of October. This is record large, and the only year that comes close is 1941, when Sep-Oct rainfall was recorded at 13”. With soil moisture at/near capacity, flooding will be the primary issue. Time will tell if yield and quality is affected.
- Argentina’s Peso is a bit stronger today, but the forward curve has weakened noticeably. Farmer profitability is rising, but producer sales will absent over the next several weeks.
- US export sales on Thursday are expected to feature 55-65 million bu of corn, 30-35 million bu of soybeans and 18-23 million bu of wheat. FAS this morning announced that exporters had sold 260,000 mt of corn to Japan for 2018/19 delivery. Recall that US weekly corn sales need average only 34 million bu to meet the USDA’s forecast.
- World canola futures continue to rally based on EU dryness and coming Canadian snowfall.
- The central US GFS weather forecast is unchanged from the morning release. Heavy/excessive rainfall lies ahead. The greatest totals still look to favour OK, KS, MO, IA and WI. Freezing temperatures stay isolated to the far Northern US and Canadian Prairies. Relative warmth across MO, IA, WI and IL may boost disease pressure.
- Grain markets continue to hesitate to break through major moving averages amid expectations of even higher yields in next Monday’s October report. Corn export demand into late year will likely be record large, and Aussie crop potential continues to decline.