10/8/20 Prices

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Another lower close across the US wheat, corn and soybean futures market overnight. The prospect of some big yields for corn and soybeans in next week’s USDA report have a lot of punters on edge. Fundamentally the market isn’t doing too bad, especially soybeans, as export orders continue to flow freely. This is all being over shadowed by what is potentially a large summer crop in the US, the season has generally been very kind to date. Wheat futures were caught up in the sell down in the row crops but after being flayed earlier in the week downward pressure was somewhat muted.
Speculation around next week’s USDA report is rife, as usual. Corn yields are key to many with punters kicking around a 180bu (11.3t/ha) average last night. With a seasonal average Good / Excellent rating of 71% thus far a 180bu average is a big call. In 2018 the average came in at 72% and the final yield was under 170bu. So just say the yield is 180bu, that equates to roughly 428.5mt of corn. If it comes in at say 172bu/ac it will be closer to 410mt, given the average acres used for other purposes than grain. In last month’s USDA report they pegged yields at 168.5bu/ac.
Soybeans followed corn lower, even after further sales of 457kt were reported to the USDA. It seems the market is so caught up in US production and yield estimates that they are ignoring the constant volume of export business being reported daily.

Interesting to note Pakistan issued a wheat tender for 1.50mt overnight. A shortfall in local production has seen the gov step in.

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