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Grain Comments: 12-01-2023

Good morning:

Corn, soybeans, wheat are all lower this morning, the dollar index is unchanged at 103.52, and crude oil futures are slightly lower. Stock markets are also trading slightly lower.

The corn market is showing no follow through from the buying that boosted futures prices in yesterday’s session. Strong export figures helped support corn prices but after the overnight trade futures are set to open 3-4 cents lower.

Soybeans are 9-11 lower this morning. Today is likely a profit taking day as funds remain long soybeans and tend to decrease risk ahead of the weekend – the result is downward pressure on soybeans. The market remains tuned into Brazil’s weather and seems to be swinging with each new weather report that is released.

USDA will release the monthly fats and oils report at 2pm CST today. Soybean crush estimates for today’s report range from 198 million to 202.5 million bushels, with a median estimate of 201.8 million bushels. The average estimate for soybean oil stocks is 1.540 billion pounds, which would be 3.9% lower than September and 26.5% lower year-over-year. Soybean oil stocks potentially will be the tightest on record based on USDA data back to May 2015.

OPEC convened their delayed meeting yesterday and decided on total production curbs of 2.2 mil bpd from eight members for early next year. This figure includes an extension of the current voluntary cuts of 1.3 mil bdp from Saudi and Russian – a figure the market expected. Crude demand has remained soft due to the struggling Chinese economy and prices have remained muted after the spike at the beginning of the Israel/Palestine conflict. The cuts are an attempt to support the price of oil in the face of weak demand.

The DOW Jones Industrial Average touched a 52-week high in yesterday’s trading. Futures this morning are down 22 points in an indication the Index will open this morning’s trade unchanged from yesterday.

Better than expected GDP readings released Wednesday helped support the equity markets; GDP for the Q3 rose 5.2% versus expectations of 5%. Favorable PCE inflation readings yesterday also helped support stock prices.

Have a great day!

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