The winning streak of five consecutive higher closes in KC wheat came to an end yesterday and wheat finished lower along with corn and soybeans. It cooled off finally and there’s moisture in the forecast for a good part of the Corn Belt, so weather premium is coming out. There’s also a lot of disappointment in soybeans where three days ago there was a lot of talk about China actively buying US beans, but the 8am USDA daily export announcements were silent in the two days following that chatter and we got nothing on that front today either. Big up in futures on the rumor, then solid lower so far since nothing materialized.
Weekly EIA ethanol data showed production down 4% from the previous week, but the previous week was also a record large grind. Blender demand was up 1%. Exports were sharply higher. Stocks declined by 0.9%. Bearish one week trend with production down, but recent weeks have been incredibly good.
This coming Monday we get the August Crop Production and Supply & Demand reports. I wouldn’t expect any major changes in corn or soybean yield, because they don’t use any enumerator data in the August report anymore. USDA did announce that they’ll factor in FSA and RMA acreage data for potential changes in planted and harvested numbers, which is good. The Reuters analyst poll had corn production at 15.112 bln bushels, up 12 mln from July and soybeans at 4.469 bln bushels, up 34 mln from July. All wheat production is pegged at 2.015 bln bushels, up 7 mln from last month. By class, the average trade estimates were looking for mildly higher production in all classes, meaning HRW, SRW, White, Durum and HRS Wheat.
Domestic old crop ending stocks estimates have corn at 1.877 bln bushels, down 1 mln from July and beans at 349 mln, up 4 mln from July. New crop stocks estimates are 2.096 bln corn, down 1 mln from last month, beans at 465 mln, up 30 mln from July and wheat 862 mln bushels, which is up 6 mln bushels from last month.
Funds yesterday were estimated sellers of 2500 wheat, 5k corn and 3k beans.
Weekly export sales in the grains were bearish wheat and fairly neutral everywhere else, at least in the current crop year numbers. Old crop totals showed 19.1 mln bushels of corn sales, 2.1 mln milo, 12 mln soybeans and 10.1 mln wheat. A jump in wheat ending stocks to a much more comfortable 800+ mln bushel total warrants weekly exports needing to be closer to, or over 20 mln, instead of 10. New crop totals gave us 9.8 mln bushels of corn, 3.7 milo, 36.2 mln bushels of soybeans and 4.1 mln wheat.
Top old crop buyers in everything were; Taiwan in wheat, Mexico in corn and China in both milo and soybeans. On the new crop side, it was the Philippines in wheat, unknown destination in corn, China in milo and China in soybeans.
IMPORTANT—PLEASE NOTE
This does constitute a solicitation to buy or sell commodities futures and/or options. The information contained herein is provided for informational purposes only. The information is not guaranteed as to its accuracy or completeness, although the information was taken from sources we believe to be reliable. The market recommendations of Loewen and Associates, Inc. are based solely on the judgment of Loewen and Associates, Inc. personnel. We do not guarantee or warranty, either expressed or implied, of success to you in the use of this information. Loewen and Associates, Inc. disclaims responsibility for or loss associated with use of information from our commentary, analysis or recommendations. There is risk of loss in trading commodity futures and options. The risk in trading can be substantial; therefore only genuine “risk” funds should be used.