Corn is trading lower today after mixed trade yesterday, which initially saw corn sharply lower before rebounding on strong export sales.
Last week’s export sales rose to 71 mb from 40 mb the prior week, with Mexico doing the heavy lifting with purchases. So far, the export pace is ahead of the USDA’s forecast.
In Argentina, the corn crop is currently rated at just 29% good to excellent due to hot and dry weather conditions, and 6% of the crop is rated poor to very poor.
US corn FOB offers are now at a sharp discount to offers out of Brazil, especially since Brazilian corn futures have rallied by 7% and are near their yearly high.
Soybeans are lower again today, as they remain under pressure from the updated Brazilian forecast, which shows better chances for rain over the next week. Prices are at support near the 100-day moving average.
Soybean meal is trading lower, while soybean oil is higher, and this could be the start of a reversal in the recent trend as Argentina is expected to export more soybean meal next year, although US demand for soybean oil as biofuel is expected to continue to grow.
Yesterday, the USDA reported 144 mb of soybean sales for last week, plus a new sale of 8.1 mb to unknown destinations. China has been the largest buyer over the past few weeks.
While central and northern Brazil, along with Argentina, are expected to get more frequent showers, southern Brazil continues to get rain and is too wet.
Wheat is trading lower today, with KC still posting the biggest losses and making new contract lows, while Chicago and Minneapolis stay slightly off their lows.
While Australia’s wheat crop has struggled with hot and dry conditions, harvest has been ahead of pace with yields so far coming in better than expected, but still more than a third below last year.
Export sales were poor again yesterday at just 6.5 mb for last week, and now near the halfway point of the season, only 267 mb of wheat has shipped, 20% less than a year ago at this time.
In Argentina, 25% of the wheat crop has reportedly been harvested, and the Buenos Aires Grain Exchange has dropped the estimated production to 14.7 mmt, which is below the USDA’s 15.0 mmt estimate.
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