Double digit higher bean close yesterday, a quiet finish in corn and wheat was sharply lower. Funds were only moderately active sellers in wheat, yet some of the Chicago contracts were pushing up against 30 lower at the finish. Estimates had funds net sellers of 4500 wheat and on the buy side of 1k corn and 3k beans.
Russia’s SovEcon raised their wheat production estimate up to 99 mmt’s and also bumped wheat exports up to 47.5 mmt’s. Part of the weakness came from that news. Ukraine’s Ag Ministry also released production forecasts yesterday, citing total grain at 50-52 mmt’s, which was unchanged from their last forecast. Last year’s crop was 86 mmt’s. They also pegged the September export forecast at 5.4-5.5 mmt’s. The August total was 4.5 mmt’s.
Remember late last winter and early last spring when some folks were claiming the Ukraine wouldn’t be able to plant hardly anything or harvest much this year because of the conflict with Russia?? Well, they raised 60.5% of last year’s crop. So, when the same folks a month or two ago were saying Ukraine might not raise any crops period in 2023, keep in mind Ukraine is already planting some winter wheat… The moral to that story; sensationalism sells subscriptions, but only fools subscribe.
Weekly export inspections data was a mixed bag of news. Starting out with the good, wheat export loadings were bullish, coming in at 29 mln bushels. The average pace needed each week to hit USDA’s export projection for the marketing year is 14.9. That makes five weeks in a row of wheat inspections that have been over what’s needed as the weekly average. To some extent that balances out two weeks in a row of single digit, terrible export sales numbers.
Unfortunately, the bad news covers all three of the fall crop markets. Corn inspections were 21.6 mln bushels and the weekly average needed is 44.6 mln. Milo shipments were 337k bushels and we need 3.9 mln per week. Soybeans were 19.1 mln and need 41 mln each week. Remember though, corn export loadings were generally very back end loaded in the marketing year, meaning it’s usually late winter or early spring before bigger numbers become common. Because of that, I’m not going to get too critical on corn numbers not being good. Soybeans on the other hand are typically front end loaded in the marketing year with big shipments. That being said, sometimes it’s mid October before beans really ramp up in the new marketing year.
The top destination in everything was China in wheat and soybeans. Mexico was #1 in milo and corn.
Chinese customs data for the month of August was depressing. Their total soybean imports were down 25% from last year and corn imports were off 44.4%. For the year their corn imports are down 21%. US pork exports to China are down in a huge way this year so far, which kinda makes the corn and soybean China numbers a little puzzling. If their hog numbers are recovered from the ASF disaster, they ought to be importing more feed in conjunction with less pork. That obviously isn’t happening.