Nick Paumen

Oct 11, 2021

Highlights

Mixed ag markets today ahead of tomorrow’s WASDE report, soybeans led the way lower but for the most part it was a quiet day in the trade. From a market news standpoint, it was a pretty quiet day with the usual Monday reports delayed. Macro markets saw a lot of the same news today where concerns remain over high inflation, supply chain issues, labor shortages, etc. Energy markets continue to face shortages as well as we head into peak demand season.

Tomorrow morning we’ll get the export inspections report, then the WASDE comes out at 11 a.m., and crop progress at 3 p.m. CDT.

  • Funds were estimated to be buyers of 2,500 contracts of corn and 1,500 of wheat. They were sellers
  • Energy markets are mostly stronger with crude up 1.19 at $80.56/barrel, contract high made today is at $81.46/barrel, RBOB up .0114 at 2.3776, and natural gas down .176 at 5.389.
  • U.S. $ is up .261 at 94.340, gold down $1.25 at $1756/ounce, lumber up 38.40 at 759.20.
  • DJIA down 106 at 34,517 and the S&P down 10.0 at 4372.

Corn

Futures managed to close stronger today despite weaker markets in soybeans and the wheat markets. Tomorrow’s report may give mixed numbers with yield expected to decline slightly but carry-in/carry-out expected increase. Harvest is expected to be 42-45% complete in tomorrow’s report, last week we were at 29% complete. The EU is seeing major harvest delays, France is only 8% harvested vs. 41% last year at this time. Did oats lend some support again today? December futures were up another 19’2 cents to close at 673’0, posting a 70+ cent rally in just the last three sessions.

  • Closes: December 21 up 2’4 at 533’0, March 22 up 2’6 at 542’2, and December 21 up 1’4 at 527’2.
  • CIF bids under pressure today and so was barge freight.
  • Spreads: Z/H even at 9’0 carry but hit a low of 9’4 carry, Z/K up 0’2 at 14’0 carry, and Z/N even at 15’0 carry.

Oilseeds

Double digit losses in soybean futures with the expectation that the report tomorrow won’t be supportive to the market. The average estimate for new crop carryout is expected to be at 300 million bushels due to the increase in carry-in and yield, September we were at 185 million bushels and last year we were at 256 million bushels. Rumors continue to swirl that China has been buying cargoes from the U.S. but due to the holiday today, notices are delayed until tomorrow. Harvest is expected to be at least 50% complete this week vs. 34% last week. Brazil is 10% planted with Mato Grosso at 20.3%, which is up 14% from last week. Weather has been more favorable in the last week for them, while Argentina could still use some more rain.

  • Closes: November 21 closed down 14’6 at 1228’2, breaking the lows of last week, January 22 down 14’4 at 1239’6, and November 22 down 11’4 at 1237’6.
  • The products were lower on the close as well today with December 21 soyoil down 1.0 at 60.51, December 21 meal down 1.6 at 317.1, and December crush up .8 at 125.5
  • CIF bids were mostly steady today, only seeing a couple cent weaker bid upfront.
  • Spreads: X/F down 0’2 at 11’4 tying contract lows, X/H down 1’0 at 21’6 carry, X/K down 1’4 at 31’0, and X/N down 2’2 at 36’6 which is a new contract low.

Wheat

Weakness was seen across the majority of the three wheat classes with the only glimpse of green from July 22 on in Chicago futures. Fresh news in the wheat world is slim; the U.S. is getting their HRW planted, and some major areas are seeing beneficial rains to get the crop started out. The report tomorrow is expected to show further decline in both the U.S. and world wheat ending stocks. Sov Econ updated is production estimate for Russia to be 3 MMT above the USDA at 7.5 MMT. Some chatter in the market that we will see Canadian wheat crop shrink even more.

  • December closes: Mpls down 1’0 at 945’4, KC down 3’0 at 734’4, and Chicago down 2’2 at 745’5.
  • New crop 22 closes: Mpls down 0’4 at 818’4, KC down 2’0 at 740’6, and Chicago up 1’6 at 740’0.
  • Spreads: Mpls Z/H even at 10’6 inverse, KC Z/H even at 8’2 carry, and Chicago Z/H down 0’4 at 13’6 carry.