Soybeans extend climb to two-month highs on Brazil concern

Morning market review: Corn narrowly mixed ahead of weekly export sales.

At a Glance

Corn futures are 1 cent lower to 0.25 cent higherSoybeans are 3 to 8.25 cents higher; soymeal is 10 cents to $1.30 higher; soyoil is 17 to 62 points higher. Chicago SRW wheat is up 1.5 to 4 cents; HRW wheat is up 4.5 to 4.75 cents; spring wheat is down 0.5 cent to up 5.5 cents.

What we’re watching

Should corn ears be upright or droopy near harvest? Depending on your crop’s maturity stage, one might be preferable to the other, according to midwest crops editor Tom J. Bechman.

USDA’s weekly Export Sales report today will be followed Monday by the agency’s quarterly Grain Stocks update Monday. U.S. corn stockpiles as of September 1 are expected to be up about 36% from the same date in 2024, based on a Reuters survey of analysts. Soybean and wheat supplies are also expected to be up from year-earlier levels.

Corn

Corn futures traded sideways to weaker overnight after climbing to two-month highs Wednesday behind spillover support from strength in soybeans and wheat.

December corn is currently down 0.25 cent at $4.15 per bushel, after gaining 3.5 cents Wednesday to $4.1525, the new-crop contract’s highest settlement since July 25. Futures are up nearly 8% from a contract low of $3.85, posted August 26.

For December corn, near-term chart resistance comes in around Tuesday’s high of $4.1825, with further resistance around the July highs, from $4.24 to $4.26. Near-term support is seen around Monday’s low of $4.0125.

Analysts expect USDA to report 2024/25 corn sales for the week ended September 19 at 600,000 to 1.3 million metric tons, based on a Reuters survey. Last week’s sales of 666,458 metric tons were around the middle of trade expectations.

The Buenos Aires Grains Exchange forecast Argentina’s 2024/25 corn crop at 47 million metric tons, down 5% from 2023/24. Argentine farmers are expected to favor soybeans over corn due to stronger profitability prospects and fears about leafhoppers that damaged last year’s corn crop.

U.S. ethanol producers are scaling down production as the end of the summer driving season lessens gasoline consumption. Early Wednesday, the Energy Information Administration reported ethanol production fell to an average of 994,000 barrels per day during the week ended September 20, down 5.2% from the previous week and the lowest weekly average since early May.

Ethanol production over the past four weeks, at an average of 1.046 million barrels a day, was still up 3.6% from the same period in 2023. Ethanol stocks fell 1.1% last week to 23.5 million barrels.

Basis bids at country elevators in Illinois were mostly unchanged Wednesday, though bids at some southwest locations jumped 1 to 8 cents and ranged from 25 to 76 cents under December futures, according to a USDA report. By contrast, barge elevators on the south Illinois River were flat to down as much as 7 cents, while locations on the Mississippi River dropped 5 to 11 cents and ranged from 23 to 29 cents under December futures.

In Iowa, country elevator bids were steady to weaker, with southeast locations unchanged to down as much as 5 cents and south central locations down 1 to 2 cents. Bids in the northeast were flat to 3 cents lower.

Soybeans

Futures climbed overnight to extend the market’s ascent to two-month highs, driven by renewed concern that dry conditions in Brazil could hamper planting. Only “spotty” rains are expected over the next two weeks in Mato Grosso, Brazil’s top soy-growing state, the Commodity Weather Group said, according to Reuters.

November futures are up about 6 cents at $10.5925 after earlier reaching $10.6175, the new-crop contract’s highest intraday price since $10.8050 on July 26. A higher close today would mark November futures’ fifth straight daily advance. Futures have rallied over $1, or 11%, since recording a contract low of $9.55 on August 16.

December soybean meal is up $1.20 at $329.40 per ton and December soybean oil is up 49 points at 44.64 cents per pound.

For November soybeans, near-term resistance comes in around a late-July high $10.8675 and the 100-day simple moving average around $10.83. Near-term support is seen at Monday’s low of $10.12.

Traders expect the USDA to report weekly soybean sales of 900,000 to 2 million metric tons for 2024/25, compared to 1.748 million metric tons the week prior.

In Brazil, a widespread drought has halted the transport of grains through the Madeira river, an important northern waterway linking key croplands with the country’s ports, a regional port terminals association said Wednesday. The Madeira river is a key corridor for shipping products from Rondonia state and parts of Mato Grosso, Brazil’s top soy producer, to export terminals in northern states.

Part of soybean futures’ recent strength has been driven by speculators rapidly unwinding a heavy short position built over the summer as prices fell. During the first three days this week, commodity funds bought an estimated 35,000 soybean futures contracts, after selling a net of about 8,500 contracts last week, according to Reuters.

On cash markets, basis levels were steady to firmer at country elevators across Illinois on Thursday. South central locations led the way higher, with bids flat to up as much as 10 cents, at 40 to 59 cents under November futures. In the southwest, bids were unchanged to up 5 cents, while north central and west locations held steady.

Barge elevators on the Mississippi River strengthened 15 to 23 cents, to 10 cents under November futures. Illinois River bids were unchanged to 7 cents higher.

In Iowa, country elevator basis bids were mixed. Southwest locations ranged from down 5 cents to up 2 cents, while the north central was unchanged to up 6 cents and the northeast was steady to down 1 cent. At mills and processors, bids ranged from 5 cents lower to 5 cents higher.

Wheat

Futures are on track to post gains for the third day this week after firming overnight as the market remained underpinned by an outlook for tightening global supplies and concern over weather problems in major producers such as Russia.       

December Chicago wheat is up 4 cents at $5.9325 after earlier climbing to $5.9350, the most-active contract’s highest price since $5.96 on September 16. December Kansas City wheat is up 4.5 cents at $5.8550 and December Minneapolis wheat is up 4.5 cents at $6.2150.

Analysts expect USDA to report combined old and new crop weekly wheat sales ranging from 199,000 to 650,000 metric tons, compared to 246,300 metric tons the previous week.

Winter wheat sowing rates in Russia have fallen to an 11-year low due to drought in key producing regions, clouding the outlook for the 2025 grain harvest, Reuters reported, citing the Sovecon consultancy said Wednesday. As of September 20, 8.3 million hectares had been sown to winter grains, down from 9.3 million hectares a year earlier and the lowest since 2013

Russia, the world’s biggest wheat exporter, has kept its official production forecast at 132 million metric tons this year despite extreme weather hitting many key grain-producing regions.

On cash markets, basis at country and terminal elevators in Kansas held steady. Country elevators ranged from 54 cents under December futures in central locations to 72 to 75 cents under in the northwest. Terminal elevators ranged from 10 to 40 cents under December in the south to 55 cents below December in the northeast.

Weather

The remnants of Hurricane Helene will be moving through the Mid-South, Southeast and Ohio River Valley later this week, bringing 4 inches or more of rain to areas including the southeast corner of Missouri and the southern tips of Illinois and Indiana, according to the National Weather Service’s latest 72-hour cumulative precipitation map. Central parts of Illinois and Indiana and southwest Ohio may receive 0.5 to 1.5 inches.