Corn, Soybean Prices Drop Wednesday

(Agriculture.com) – On Wednesday, the CME Group’s farm markets have little support.

In early trading, December corn futures are 2¼¢ lower at $3.86¼; March corn futures are 2½¢ lower at $3.97.

November soybean futures are 2¾¢ lower at $9.31¼; January soybean futures are 3¢ lower at $9.45¾.

December wheat futures are ¾¢ lower at $5.17¾.

December soy meal futures are 60¢ per short ton lower at $306.90. December soy oil futures are 0.16¢ lower at 30.69¢ per pound.

In the outside markets, the NYMEX crude oil market is 26¢ per barrel lower, the U.S. dollar is higher, and the Dow Jones Industrials are 53 points higher.

Private exporters reported to the USDA export sales of 128,000 metric tons of soybeans for delivery to unknown destinations during the 2019/2020 marketing year.

The marketing year for soybeans began September 1.

Al Kluis, Kluis Advisors, says investors are still digesting what the Chinese announcement on trade tariffs means for the soybean market.

“The big headline on Tuesday was tied to comments that China might offer tariff exemptions on a sizable amount of U.S. soybeans. The key word is “might.” If traders expected it to really happen, we should have seen prices make a convincing move higher. However, the soybean market was nearly flat at the end of trading on Tuesday. The lackluster price action that followed this headline warrants caution for the soybean bulls. Unless we see soybean exports pick up and confirm this headline, the bears will try to regain control of prices,” Kluis told customers in a daily note.

Kluis added, “Corn exports are falling further behind the USDA pace on a weekly basis. Ethanol margins have not been profitable for much of 2019. A combination of decreased demand and lower production could leave the corn market in a trading range until a trade deal is reached.”

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TUESDAY’S GRAIN MARKET REVIEW

On Tuesday, the CME Group’s farm markets have support from a bullish Crop Progress Report.

However, after trading as a high as a dime, the soybean market has sold off.

At the close, December corn futures finished ¾¢ higher at $3.88; March corn futures closed ½¢ higher at $4.

November soybean futures settled ¾¢ higher at $9.34; January soybean futures closed 1½¢ higher at $9.48¾.

December wheat futures ended 5¼¢ lower at $5.18.

December soy meal futures settled 80¢ per short ton lower at $306.90. December soy oil futures closed 0.37¢ higher at 30.85¢ per pound.

In the outside markets, the NYMEX crude oil market is 90¢ per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 42 points higher.

Britt O’Connell, cash adviser for Commodity Risk Management Group, says corn and bean markets find themselves higher today, after the Chinese vice foreign minister said that if the U.S. and China continue to respect each other, no problem could not be resolved.

“After a strong open, the markets have backed off their earlier highs. Both markets continue to trade a 20¢ range where they have found comfort. I expect that to continue until we have reason not to – possibly the November 8 WASDE, as it is supposed to include either real or perceived damage from the frost and snow a couple of weeks ago,” O’Connell says.

Al Kluis, Kluis Advisors, says investors are reacting to harvest delays.

“I am watching harvest progress of soybeans in Minnesota, North Dakota, and South Dakota. Wet weather and snow later this week will slow down the already slow soybean harvest. When the USDA factors in a smaller crop and increased exports, the November USDA Supply/Demand Report will take projected soybean ending stocks down from 460 million bushels to less than 400 million bushels,” Kluis told customers in a daily note.

Kluis added, “The weather looks wetter in South America and a lot of crop was harvested over the last weekend ahead of the rain.”

MONDAY’S GRAIN MARKET REVIEW

On Monday, the CME Group’s farm markets sell off.

At the close, December corn futures closed 3¾¢ lower at $3.87¼; March corn futures finished 3¼¢ lower at $3.99½.

November soybean futures closed ¾¢ lower at $9.33½; January soybean futures ended ¾¢ lower at $9.46¾.

December wheat futures closed 8¾¢ lower at $5.23½.

December soy meal futures settled 80¢per short ton lower at $307.70. December soy oil futures closed 0.12¢ higher at 30.48¢ per pound.

In the outside markets, the NYMEX crude oil market is 46¢ per barrel lower, the U.S. dollar is higher, and the Dow Jones Industrials are 45 points higher.

Al Kluis, Kluis Advisors, says investors have a lot of world crop weather to watch.

“The wet weather throughout the Corn Belt later this week and into early November will result in very slow harvest for both corn and soybeans this year,” Kluis told customers in a daily note.

Kluis added, “How much rain will hit – and when – in the dry areas of central Brazil? The planting delays for soybeans will not have much impact on soybean yields (but the corn production in Brazil will move lower) as the double-crop corn acreage and yield potential moves lower.”