Morning Commentary

Sept corn down 2 ¼ at $3.60

Nov beans down 7 ¾ at $8.72

The DOW is down

USD is stronger

Crude oil down $.66 at $66.38

Good morning,

Corn traders are wondering if the market can gather enough momentum to trade back north of $3.88 per bushel, a level that has been very tough as of late for the DEC18 contract to trade beyond. It seems like the bulls can push to $3.80, but then start to lose their footing. Keep in mind, the DEC18 market hasn’t closed above $3.90 since early-June. There’s not a lot fresh or new in the headlines.

Soybean bears are talking about improved U.S. weather, mostly normal temperatures and above normal rainfall now in the forecast across large portions of key U.S. growing regions. This is starting to bring about more talk of increasing yields and the more realistic probability of the U.S. harvesting a +4.5 billion bushel crop and ending stocks staying north of +750 million bushels. The bears clearly believe there is more downside risk in the market and that prices could eventually fall to sub-$8.00. Keep in mind, the USDA recently lowered the U.S. season-average farm price by -35 cents per bushel with the range now being from $7.65 to $10.15.

China’s demand for Brazilian soybeans has been on the rise, and Reuters reports that more Brazilian farmers have opted to plant soybeans instead of sugarcane. Government data shows that Brazilian soybean plantings have expanded 2 million hectares in two years, while the land planted to cane has fallen by nearly one million acres.

U.S. exports of grain in all forms are on track to set a new record in 2017/18 with two months of sales left to report, according to data form the USDA and analysis by the U.S. Grains Council. During the first 10 months of the marketing year (September 2017 to June 2018), the U.S. exported 98.3 million metric tons (38.7 billion bushels) of grain in all forms, up 2% year-over-year from last year’s record setting pace. The feed grains in all forms calculation helps capture how much of U.S. coarse grain production is actually used in the world market by including the corn equivalent of c0-products like ethanol and distiller’s dried grain with solubles as well as beef, pork and poultry meat exports. (Source: USGC)


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