- It has been another down day in Chicago. Export sales were decent, and better than expected in soybeans, while the midday GFS weather forecast has added heavy rainfall to S Brazil beginning late next week. Argentina’s forecast is little change, and is still dry and rather hot into the latter part of December. Outside markets are mixed, with crude up $.60/barrel, which is rallying gasoline’s premium to ethanol further. Through the week ending November 30, US exporters sold abroad a net 35 million bu of corn, up 11 million from the prior week and some 8 million above the pace needed to hit the USDA’s forecast. Wheat sales totalled 12 million bu, nearly double the previous week but still disappointing. Soybean sales totalled a respectable 74 million bu, up 40 million from the previous week and the highest since mid-October.
- For their respective crop years to date, the US has exported 902 million bu of corn, down 27% from last year; 642 million bu of wheat, down 10%; and 1,335 million bu of soybeans, down 16% from a year ago. No changes are warranted to wheat and corn export forecasts based on pace analysis, but the overall sum of foreign soybean demand remains lacklustre. A downward revision in coming WASDE reports is logical, but we wonder if the USDA requires more input on S American production before starting the process. Recall beans sales and shipments beyond Apr/May can vary substantially based on S American balance sheets.
- Russia has announced it will spend roughly $34 million in grain transportation subsidies in an effort to boost export capacity in 2018, and which may also help boost domestic prices, which as of last week are down substantially (about 15-20% in Ruble terms) from this week in 2016. The battle between uncertain, and largely concerning, S American weather, and next week’s WASDE report, which will again confirm sizeable stocks of major crops will sustain choppy trading, and only in late winter will a majority of S America’s crop-critical weather have passed.
- Stats Can data on Wednesday and next week’s rain event in Argentina have weighed on the markets recently. The entirety of South America’s growing season lies ahead!