September 4, 2023 – Market Focus

Good morning, Farmer Family …

Main Markets

US farm markets were mixed but mostly lower on Friday.
Corn prices gained 0.68%.
Soybeans picked up 0.04%.
The rest of the soy complex was mixed, as soymeal faded 0.86% lower, while soyoil shifted 1.28% higher.
Wheat prices continued to shift lower as Chicago SRW lost 1.08%, Kansas City HRW dropped 0.62%, and Minneapolis spring wheat fell 0.91%.
The USDA confirmed private sales of 198,000 metric tons of U.S. new-crop soybeans to unknown destinations, marking six consecutive trading days of daily soybean sales notices.
The monthly Grain Crush data from NASS had 454 mbu of corn used for ethanol during the month of July, with the full year’s draw sits at 4.733 billion bushels.
The NASS Fats and Oils report showed 184.8 mbu of soybeans were processed in July, with the season’s crush sits at 2.043 bbu, and bean oil stocks at 2.149b lbs.
The Monthly Biofuel Capacity and Feedstock report showed June soy oil use at a record 1.207 bil. lbs. Year to date bean oil use hit 8.81 billion lbs. by the end of June.
Weak export demand has pressured wheat prices, as domestic flour mills are mostly well-supplied.
Corn basis bids were steady to weak after dropping 5 to 10 cents lower across three Midwestern locations.
Soybean basis bids were steady to soft after eroding 3 to 35 cents lower across five Midwestern locations.
Wheat basis ended the week mixed. Notably basis was up across all wheat classes in the Gulf, while HRS basis was flat in the PNW. HRW basis was down, widening the spread between Gulf and PNW HRW once again. SW prices were down. Great Lakes basis increased sharply.
Commodity funds sold 2,000 lots of wheat in Chicago on Friday. At the same time, they bought 3,500 lots of corn and 500 lots of soybeans.
For the week …
Corn lost 1.33% on the week.
Soybeans closed the week down 1.33%.
Wheat dipped 4.22%, its second consecutive weekly decline.
Today, US grain markets are closed, in observance of the federal Labor Day holiday.
As a result, we’ll back Wednesday for our next round of US ag news and analysis.
South America
Brazil’s 2023/2024 first corn crop could reach 28.2 million metric tons, according to consultancy StoneX, while second corn crop could reach 109.1 million metric tons.
Governmental data shows that Brazil’s corn exports reached 9.40 MMT in August.
Brazil’s soybean exports in August reached 8.57 MMT.
The Buenos Aires Grain Exchange noted that for the week ending August 30, 2023-24 wheat conditions were at 77pc as fair/excellent.
Concerning the country’s 2022/2023 corn harvest, the exchange said 1.1% of the crop’s planted area remains to be harvested.
European wheat price fell on prospects for a revival of the Black Sea grain export deal.
An estimated 82% of French grain maize crops were in good or excellent condition by Aug. 28, farm office FranceAgriMer said on Friday.
Strategie Grains estimated production of rapeseed at 18.9 million metric tons, sunflower seed at 10.3 million tons, soybeans at 2.84 million tons.
Turkish President Erdogan is travelling to Sochi, to meet Vladimir Putin and discuss the future of the Grain Deal.
Ukraine has harvested more than 33 million metric tons of grain and oilseeds of the new 2023 harvest so far, agriculture ministry said on Friday.
According to the State Customs Service, in 2023/24 MY, as of September 1, Ukraine exported 4.521 mln tonnes of grains and pulses.
Ukraine is exporting more wheat than last year despite the collapse in July of a safe-passage deal for grain ships.
Two more cargo vessels have left a port near Odesa.
UGA has updated its forecast for crop in 2023 at 80.5 MMT of grains and oilseeds. Exports potentially could reach 49 MMT.
Russian drones hit Danube River port infrastructure in the early hours of Sunday morning. A fire that resulted from the attack at the facility was quickly extinguished.
IKAR saw Russia’s grain crop this year to 140.0 million metric tonnes, and grain exports potential at 64.0 million tonnes in the 2023/24 season.
South-East Asia
Malaysian palm oil prices edged up on Friday.
Exports of Malaysian palm oil products in August ranged between 1,171,998 tons and 1,201,488 tons during July.
Australia is likely to lower its wheat production forecast for 2023/24 by about a million metric tons as dry El Nino weather reduces yields.
August rainfall was below average for the southern two-thirds of Queensland, most of New South Wales, Victoria and South Australia and south-western Western Australia.
Aussie local new-crop wheat and barley markets finished the week a touch softer, on Friday. Meanwhile canola markets were pretty quiet.


Corn & Soymeal
The Korea Feed Association (KFA) purchased an estimated 55,000 tonnes of animal feed corn in an international tender on Friday. Iranian state-owned animal feed importer SLAL has issued two international tenders to purchase up to 180,000 metric tons of animal feed corn and 120,000 tons of soymeal.
Egypt’s state grains buyer bought about a half a million metric tons of Russian wheat in a private deal on Friday, succeeding in negotiating lower prices than those offered in the more traditional tenders. GASC also is believed to have bought an estimated 60,000 metric tons of wheat in direct negotiations with trading houses on Friday without issuing an international tender.


Energy markets
Oil prices rose to their highest in over half a year.
Saudi Arabia is widely expected to extend a voluntary 1 million barrel per day oil production cut into October, and Russia, has already agreed with OPEC+ partners to cut oil exports next month.
Brent rose about 4.8% for the week, the most it has increased in a week since late July.
WTI advanced by 7.2% in the week, its biggest weekly gain since March.
This morning, oil prices were stable.
Ocean freight markets
The Baltic Exchange’s main sea freight index in London fell, posting its second straight weekly decline, weighed by a dip in capesize and panamax vessel rates.
Equity markets
On Wall Street, US stock indexes settled for a mixed close and benchmark Treasury yields rebounded after a U.S. jobs report showed an uptick in unemployment. All three indexes notched gains on the week.
This morning, stocks were higher both in Europe and Asia, following a report that signaled the US jobs market, while still healthy, shows some signs of cooling, raising hopes for an easing of interest rate hikes.
Currency trading
The dollar index rallied as T-note yields rose on stronger-than-expected U.S. Aug ISM manufacturing index.
This morning, the U.S dollar rose to 146.36 Japanese yen from 146.22 yen late Friday. The euro rose to $1.0793 from $1.0779.

That’s all, thank you.
We wish you a nice day.

Author: Sandro F. Puglisi

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