Market Commentary  10/21/19 2:45:39 PM Printer Friendly VersionPrinter Friendly Version

Monday October 21, 2019

Corn futures traded both sides of unchanged, but ultimately ended the session weaker. December corn broke through initial support at $3.87 ½ but closed above the 20-day moving average ($3.86 ¼). Harvest continues to be strung out across portions of the U.S., limiting losses. However, continued poor demand for corn hangs over the market. NASS will release updated crop progress numbers this afternoon. Traders are looking for corn harvest to be near 34% complete. A week ago, 22% of the corn crop was estimated to be shelled vs 48% last year and a 42% 5-year average. Weekly U.S. corn export inspections remained lackluster, at just 20.9 mln. bu. in this morning’s report. This is well below last year’s same week exports of 40.8 mln. bu. and below the roughly 36 mln. bu. “needed” per week to reach USDA’s annual export forecast. Corn sales continue to struggle as Argentina & Brazilian offers remain much cheaper than the U.S. (especially Argentina). The midday weather maps showed a wet forecast for the Northern Plains to the Upper Midwest, with rain and snow totals of 0.5-1.5” expected. Another system is then expected to push through the Midwest/Delta next week and temperatures look to cool down.

Soybean futures closed mixed today. Initial support was noted on rumors China was possibly buying U.S. soybeans. Concerns regarding slow U.S. harvest progress and yield losses in MN & ND were also seen as friendly. However, late in the session futures faltered; on the lack of confirmation that China was in for U.S. beans. The sell-off in wheat and corn later in the day also offered spillover pressure. Market participants will continue to monitor U.S./China trade news moving forward. The situation looks somewhat promising to start the week, as China’s top negotiator recently reiterated that both sides were working hard on “phase one” of the trade agreement. President Trump also indicated that he thinks a partial deal will be signed between the two countries by mid-November. NASS will release updated crop progress numbers this afternoon. Market participants are expecting to see U.S. soybean harvest near 42% complete. This is a sizeable jump from last week’s 26% but still lags last year’s 51% as well as the 64% 5-year average. In South America, more rain and cooler temperatures are needed to support soybean planting and development. AgRual has reported Brazil’s bean crop is 21% planted. This is below last year’s pace of 34% but in-line with the 5-year average.
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