Corn is trading lower this morning following lower ethanol production than expected, but trade remains rangebound.
Heavy rains are forecast for the northwestern Plains and Texas and Arkansas, too late to help the crop but may improve water levels on the Mississippi.
Yesterday’s report from the US Energy Department said that just 980,000 barrels of ethanol were produced last week which was the lowest since May.
After estimates for Brazil’s corn crop were lowered to 119.8 mmt on a decrease in planted acres by 4.8%, corn on the Bovespa exchange traded higher at the equivalent of $5.60 a bushel.
Soybeans are trading lower this morning but are hovering right above the 100-day moving average which could be acting as support. Both soybean meal and oil are lower.
While Brazil decreased their corn planted acres, they increased acres for soybeans and are now expecting a massive 162.4 mmt crop which is pressuring prices.
China appears to be banking on having access to a large, cheap Brazilian crop next year as their soybean futures on the Dalian exchange are trading at the equivalent of $17.68 for November, but March beans are trading at the equivalent of $15.81.
Chinese August soy imports from Brazil are now up 45% from the previous year.
All three wheat contracts are slightly lower this morning as a lack of export demand keeps prices at these low levels.
According to the Wall Street Journal, the Ukrainians have been so successful that Russian ships are no longer safe in the northwestern part of the Black Sea which is why Ukraine has been able to start sending ships through that passage.
Yesterday, the Fed announced they would not do another rate hike, but they would keep rates this high until later next year. This caused the dollar to increase which is bearish for wheat.
Sov Econ cut their estimates for Russian wheat production for 2023 to 91.6 mmt from 92.1 mmt citing a decrease in Siberia’s expected crop.
Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.
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