Corn is trading slightly lower this morning following yesterday’s rally, but prices remain very rangebound and near contract lows.
There has been some support from hot and dry South American weather, but this has primarily benefited soybeans as plantings have been delayed.
Estimates for today’s WASDE report are calling for the corn yield to increase slightly from 173 bpa to 173.3, for ending stocks to rise slightly, but world stocks to decline.
Managed money has added to their already large net short position lately and it appears that they are preparing for a bearish report.
Soybeans are trading slightly higher this morning but gave back their large gains from yesterday morning as trade quiets down ahead of today’s WASDE report.
Soybean meal made new contract highs yesterday thanks to strong export demand, but soybean oil has been trending lower along with lower crude oil and world veg oils.
Today’s USDA report is expecting soybean yields to remain steady to slightly lower with ending stocks rising 3 mb due to adjustments in demand. World ending stocks are expected to decline slightly.
Despite the hot and dry weather, CONAB has slightly raised its forecast for soybean production over the 23/24 season. They are estimating a crop of 162.4 mmt, but the growing season has not started off well.
Wheat is lower this morning but posted solid gains of 22 cents yesterday in the December Chicago contract. Overall, lack of export demand has seriously depressed prices.
The net short positions held by managed money over all three wheat contracts is close to a record short. Any friendly news at this point could cause short covering.
Today’s WASDE report estimates are that US wheat ending stocks will remain unchanged at 670 mb, but that world ending stocks could decrease slightly as many countries deal with adverse weather.
The Argentinian wheat crop forecast has been cut by 5.6% to 13.5 mmt by the Rosario Board of Trade. It is expected to be just 1.7 mmt larger than last year’s drought crop.
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