Good morning.
Ag markets are lower to start the new week with the soy complex being the early downside leader on a gap-open start to the overnight trading session. China returns from its Golden Week holiday today, while traders will otherwise likely take a cautious approach to the week with the USDA’s October WASDE report due out on Friday. This and harvest progress look to make up most the of early-week headlines that are ag-specific, while geopolitical happenings around the world look to continue to influence price movement as well. It was another active harvest weekend across the Midwest, with this morning’s selling likely being a product of hedging on bushels that were acquired over the last 72 hours. Corn futures are trading 1-2 cents lower to start the week, soybean futures are 6-7 cents lower, and the Chicago wheat market is down 1-2 cents; high on Nov beans as of this writing is 10.33 3/4, down 4 cents. Products are mixed, soybean meal is down $3-4/ton, and soybean oil is up 5-10 points; meal also had a gap-lower open. Outside markets are mixed also, crude oil futures are up another $1.80-1.90/bbl, the Dow Jones index is down 170 points, and the US$ index is unchanged. The S&P500 is down 25 points, and the NASDAQ is down 130 points.
Friday afternoon’s CFTC commitment of trader’s report showed as of Tuesday, October 1st, managed money was net-short 67,699 contracts of corn (+63,000 on the week), net-short 34,886 contracts of soybeans (+40,091), and net-short 22,953 contracts of Chicago wheat (-3,517).
In soy products, managed money is now seen net-long 15,803 contracts of soybean oil (+34,660), and net-long 103,209 contracts of soybean meal (+44,949).
Of note, this is the first time funds have been net-long bean oil since the beginning of April; this is also the smallest net-short position the funds have held in soybeans since the end of May, and the smallest net-short position they’ve held in corn since August of 2023.
According to private ag group Safras & Mercado, soybean planting in Brazil has reached 4.1% complete as of October 4th, which compares to 7.8% last year on that date and the five-year average of 5.5%. Parana is 24% complete, MGDS is 4% complete, and Mato Grosso is 2% complete.
On the other side of the world, private ag group SovEcon lowered their estimate of Ukraine’s corn crop to 23.5 mmt’s due to continued dry weather; the previous estimate was 24.6 mmt’s. Exports were subsequently lowered by 1.1 mmt’s as well.
US federally inspected pork production in the week ending October 5th was seen at 549 mil lbs., which was up 1.7% from the week prior; beef production was seen at 525 mil lbs., up 0.2% on the week. YTD pork production is up 1.6%, and beef production is down 0.7%.
Energies are higher and the stock market is lower to start the week following a trading of missile and bomb attacks over the weekend by Israel and Hamas. Fighting continues to escalate in the region, as today marks the one-year point of the conflict, but things stand mostly in the same place today as they did go home last week.
Otherwise, equities early this week will be under continued influence from Friday’s blowout jobs report, while the rest of the week sees minutes from the Fed’s September FOMC meeting released on Wednesday, and inflation data for September due out on Thursday/Friday.
Weekend weather across the Midwest was conducive to harvest, as most of the Corn Belt continued to see warm/dry conditions. Light/scattered showers of less than 0.5″ impacted parts of IL/IA, and also areas of PA/WV and up into the northeast, but that was the extent of the moisture received according to satellite data.
More of the same is expected for this week, as the models still see next to zero chances at precipitation over the next 10-15 days. Hurricane Milton will soak parts of Southern Florida by the end of the week, but otherwise, the rest of the country looks to hold in a dry pattern which should allow for a rapid advancement of harvest pace.
Temperature-wise, today will be the coolest day in the eastern Corn Belt, with all but the East Coast returning to well above average temps for this time of year starting tomorrow, as ridging causes heat to return. High’s look to hit the upper 80’s/low 90’s in parts of the western Corn Belt on Wednesday/Thursday before again turning more seasonal by the weekend.
According to satellite data, South America saw decent rains across northwest Brazil over the weekend, while Argentina and southern Brazil saw localized showers, but not much else. Forecasts show a front moving into northern Argentina this morning/today, with that system expected to make it into Brazil by mid-week.
Forecasts both in the short term and the two-week period continue to see better rain chances for most of both of the two country’s growing regions, as the monsoon season looks to be arriving just 10-15 days later than normal. Planting pace in Brazil likely takes a big jump in the next two weeks should these forecasts verify.
Have a great day.
Grain Comments: 10-07-2024
Good morning.
Ag markets are lower to start the new week with the soy complex being the early downside leader on a gap-open start to the overnight trading session. China returns from its Golden Week holiday today, while traders will otherwise likely take a cautious approach to the week with the USDA’s October WASDE report due out on Friday. This and harvest progress look to make up most the of early-week headlines that are ag-specific, while geopolitical happenings around the world look to continue to influence price movement as well. It was another active harvest weekend across the Midwest, with this morning’s selling likely being a product of hedging on bushels that were acquired over the last 72 hours. Corn futures are trading 1-2 cents lower to start the week, soybean futures are 6-7 cents lower, and the Chicago wheat market is down 1-2 cents; high on Nov beans as of this writing is 10.33 3/4, down 4 cents. Products are mixed, soybean meal is down $3-4/ton, and soybean oil is up 5-10 points; meal also had a gap-lower open. Outside markets are mixed also, crude oil futures are up another $1.80-1.90/bbl, the Dow Jones index is down 170 points, and the US$ index is unchanged. The S&P500 is down 25 points, and the NASDAQ is down 130 points.
Friday afternoon’s CFTC commitment of trader’s report showed as of Tuesday, October 1st, managed money was net-short 67,699 contracts of corn (+63,000 on the week), net-short 34,886 contracts of soybeans (+40,091), and net-short 22,953 contracts of Chicago wheat (-3,517).
In soy products, managed money is now seen net-long 15,803 contracts of soybean oil (+34,660), and net-long 103,209 contracts of soybean meal (+44,949).
Of note, this is the first time funds have been net-long bean oil since the beginning of April; this is also the smallest net-short position the funds have held in soybeans since the end of May, and the smallest net-short position they’ve held in corn since August of 2023.
According to private ag group Safras & Mercado, soybean planting in Brazil has reached 4.1% complete as of October 4th, which compares to 7.8% last year on that date and the five-year average of 5.5%. Parana is 24% complete, MGDS is 4% complete, and Mato Grosso is 2% complete.
On the other side of the world, private ag group SovEcon lowered their estimate of Ukraine’s corn crop to 23.5 mmt’s due to continued dry weather; the previous estimate was 24.6 mmt’s. Exports were subsequently lowered by 1.1 mmt’s as well.
US federally inspected pork production in the week ending October 5th was seen at 549 mil lbs., which was up 1.7% from the week prior; beef production was seen at 525 mil lbs., up 0.2% on the week. YTD pork production is up 1.6%, and beef production is down 0.7%.
Energies are higher and the stock market is lower to start the week following a trading of missile and bomb attacks over the weekend by Israel and Hamas. Fighting continues to escalate in the region, as today marks the one-year point of the conflict, but things stand mostly in the same place today as they did go home last week.
Otherwise, equities early this week will be under continued influence from Friday’s blowout jobs report, while the rest of the week sees minutes from the Fed’s September FOMC meeting released on Wednesday, and inflation data for September due out on Thursday/Friday.
Weekend weather across the Midwest was conducive to harvest, as most of the Corn Belt continued to see warm/dry conditions. Light/scattered showers of less than 0.5″ impacted parts of IL/IA, and also areas of PA/WV and up into the northeast, but that was the extent of the moisture received according to satellite data.
More of the same is expected for this week, as the models still see next to zero chances at precipitation over the next 10-15 days. Hurricane Milton will soak parts of Southern Florida by the end of the week, but otherwise, the rest of the country looks to hold in a dry pattern which should allow for a rapid advancement of harvest pace.
Temperature-wise, today will be the coolest day in the eastern Corn Belt, with all but the East Coast returning to well above average temps for this time of year starting tomorrow, as ridging causes heat to return. High’s look to hit the upper 80’s/low 90’s in parts of the western Corn Belt on Wednesday/Thursday before again turning more seasonal by the weekend.
According to satellite data, South America saw decent rains across northwest Brazil over the weekend, while Argentina and southern Brazil saw localized showers, but not much else. Forecasts show a front moving into northern Argentina this morning/today, with that system expected to make it into Brazil by mid-week.
Forecasts both in the short term and the two-week period continue to see better rain chances for most of both of the two country’s growing regions, as the monsoon season looks to be arriving just 10-15 days later than normal. Planting pace in Brazil likely takes a big jump in the next two weeks should these forecasts verify.
Have a great day.
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