He noted the Corn Belt didn’t quite get the heat in July and so far in August that had been forecast and with rain to come he said, “everything is just ideal.”

“Anyone catching some rain from this point on to the end of the month, that’s going to be beneficial to corn and soybeans,” Capinegro added.

In turn, that played into the recent downward trend for soybeans and corn futures at the Chicago Board of Trade. The broker said the increases both commodities had on Aug. 14 were most likely a ‘dead cat bounce’ and the declines would soon resume.

Capinegro said the August supply and demand report from the U.S. Department of Agriculture pegged soybean ending stocks for 2024/25 at 560 million bushels, up from July’s estimate of 435 million.

“We’re in the camp that’s going to go to 600 million just because they’re overstating exports,” he stated, which would be well above the 2023/24 carryover of 345 million bushels.

However, Capinegro theorized the USDA could be factoring in an assumption that soybean prices are going to fall further and in turn that would generate greater exports.

He also suggested that soybean futures could feel more pressure should Brazil’s next crop get off to a good start. He said it’s likely there will be more soybean acres planted in Brazil for 2024/25, but not to any great extent.

The broker noted the Pro Farmer crop tour is set to begin Aug. 19, with the trade keeping an eye on the results.

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Soybean futures recently hit multi-year lows, and “traders are now searching for something bullish to latch onto,” said Terry Reilly, senior agricultural strategist with Marex in Chicago, adding “I expect (the market) to chop around over the next few weeks until we get into the growing season.”

Demand for soymeal and soyoil will also dictate where the soybean market goes, with mixed activity on that front contributing to the two-sided activity in beans. Soyoil has tested lows recently, while meal moved higher.

For corn, “there’s no real issues with corn planting,” said Reilly. He noted that soaking Corn Belt rains may cause seeding delays but added that there was still plenty of time to get the crop in the ground which will keep the corn market from rallying.

Wheat futures found strength over the past week, with concerns over cold conditions in Europe and a lack of moisture in Russia and parts of the U.S. Plains providing support.

“I expect the wheat market will remain in a wide sideways trading range over the next few weeks,” said Reilly, adding that values could retest their highs if rains don’t materialize in Russia.

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Corn and the soy complex on the Chicago Board of Trade (CBOT), as well as the U.S. wheat complex, were presently mixed. However, Capinegro believed gains were in the offing.

“Probably the next seven to 10 days will give us a better indicator of what’s happening [with corn]. We’re getting those high temperatures, but we are going to be back at 90 to 93 F. We still need moisture,” he said, noting much of the U.S. Corn Belt was in the pollination stage.

Capinegro added that there’s still a “battle” between the very dry western Corn Belt and its wetter eastern counterpart. Yields in the latter are expected to be much better than those in the west.

As for soybeans, he said they can be something of a sleeper.

“Beans are borrowing time right now. It will be very interesting when Aug. 1 rolls around. If it’s still hot and looks dry, I wouldn’t be surprised if beans rallied US$1 [per bushel] in a week. That’s how beans trade, they’re putting you to sleep right now, then all of a sudden – boom – up they go quickly.”

While the U.S. wheat complex saw declines for Minneapolis spring wheat due to some scattered showers for the U.S. northern Plains and Canadian Prairies, Capinegro said the picture should become clear with harvest.

Kansas City hard red and Chicago soft white wheats were higher despite the U.S. winter wheat harvest being nearly three-quarters complete when the U.S. Department of Agriculture issued its weekly crop progress report on Monday. The spring wheat harvest has yet to begin.

“We’ll hear more bad numbers of course, but have we priced that in yet? That’s hard to say,” said Capinegro.

He suggested farmers should lock in their prices for their crops by acquiring puts.

“That leaves your options open in case something does happen.”

— Glen Hallick reports for MarketsFarm from Winnipeg.

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Chicago Board of Trade December corn settled up 18 cents at $5.58-3/4 per bushel, after reaching $5.62-3/4, its highest since July 2 (all figures US$).

CBOT August soybeans ended up 38-1/4 cents at $14.53 a bushel, with new-crop November up 31-1/2 cents at $13.83-1/4.

“The two-week forecast just doesn’t have the rains for the northern Plains and Canada,” said Dan Cekander, president of DC Analysis. While outlooks called for beneficial showers this week in portions of the Midwest corn belt, some areas may miss out.

“Next week is a dry week. You are going to be going deep into July with pretty minimal rains. It’s just not ideal,” Cekander said.

July is the main period for corn pollination, a key phase in determining yield, while August is more important for soybeans.

Concerns persist about drought in the northern Plains and Canada.

“Dry weather is expected to continue in the northern Plains for at least the next 10 days, which will maintain severe stress on spring wheat, corn, and soybeans … Temperatures will also be increasing across the northern Plains next week, adding heat stress to crops,” space technology company Maxar said in a daily weather note.

Minneapolis Grain Exchange spring wheat futures rose, with the benchmark September contract last up 11 cents at $8.72-3/4 a bushel after recording a life-of-contract high at $8.78-1/4.

CBOT soft red winter wheat futures posted even larger gains, with the September contract rising 20-1/2 cents to settle at $6.54-1/4 a bushel, reflecting fund-driven short-covering. Commodity funds hold a net short position in CBOT wheat, leaving that market prone to bouts of short-covering.

A setback in the dollar lent support, making U.S. grains more competitive globally. The dollar fell after Federal Reserve chair Jerome Powell said in remarks prepared for Congress that the economy was “still a ways off” from levels the central bank wanted to see before tapering its monetary support.

— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Nigel Hunt in London and Naveen Thukral in Singapore.

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Corn futures were mostly lower as rain in the central corn belt boosted crop prospects, while wheat was mixed amid winter crop harvest pressure and worries about the drought-hit spring crop.

“We got a lot of rain over the weekend in some areas. While that’s certainly beneficial, the longer-term forecasts — the six-to-10 day, the 10-14 day — have gotten a bit drier, especially in the western half of the corn belt,” said Ted Seifried, chief ag strategist with the Zaner Group.

“The rain was probably more beneficial for the corn. The beans are going to need more rain later on,” he said.

Grain traders are closely watching Midwest weather forecasts as drought has been creeping into western and northern production areas, including in major producer Iowa.

The U.S. Department of Agriculture (USDA) is due to update its weekly crop condition ratings later on Monday, with analysts, on average, expecting the share of corn and soybeans rated good to excellent to drop by two percentage points due to stressful Midwest weather last week.

Soybean futures also drew support from USDA confirmation on Monday of renewed buying by China, first reported by Reuters on Friday, the country’s largest-scale purchases in 4-1/2 months.

Chicago Board of Trade July soybeans were up 19 cents at $14.15 a bushel, while new-crop November soybeans were up 6-1/4 cents at $13.19-1/4 a bushel (all figures US$).

July corn gained four cents to $6.59-1/4 a bushel, while new-crop December fell 9-1/4 cents to $5.57 a bushel.

CBOT July soft red winter wheat ended down 1-1/4 cents at $6.61-1/2 a bushel.

— Karl Plume reports on agriculture and ag commodities for Reuters from Chicago; additional reporting by Nigel Hunt in London and Colin Packham in Canberra.

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Soybeans and corn edged higher, on technical trading and signs weather may not be so crop-friendly across the U.S. Corn Belt in coming days.

The most-active soybeans contract on the Chicago Board of Trade settled up 0.2 per cent at $8.73 a bushel; corn ended up 0.23 per cent, to $3.31 a bushel (all figures US$).

The most-active CBOT wheat contract settled down 1.07 per cent at $4.83-1/2 a bushel.

Traders said wheat futures also faced pressure from news Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), bought 240,000 tonnes of wheat from Russia, Romania and Ukraine in an international purchase tender.

For corn futures, traders said some weather forecasts are calling for less rain than expected in the week ahead, which could stress crops.

Earlier in the session, corn futures also saw some support from market talk of Chinese buyers potentially interested in buying U.S. ethanol, three traders said. As of Thursday morning, there was no confirmation of any such export sales.

Soybeans were bolstered by stronger than expected export demand, and the fact that South American supplies are shrinking amid aggressive Chinese buying, traders said.

“Brazil is going to exhaust their soybean supplies earlier this year than normal, and they’ve been seeing record sales in April and May,” said Joe Vaclavik, president of Standard Grain. “That is opening the door for U.S. exporters earlier than normal, and creating an opportunity — particularly for new crop beans.”

U.S. soybean exports totalled 1.92 million tonnes for the period ending June 11. They included 1.353 million tonnes sold to China, the biggest weekly total for the world’s top soybean buyer since September, the U.S. Agriculture Department said.

— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago; additional reporting by Naveen Thukral and Maytaal Angel.

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But despite the low prices, U.S. farmers are expected to boost acreage significantly over last year’s levels, which were dampened by historic rains and waterlogged soils.

Not only are corn acres set to rise on the year, but many recent industry estimates peg U.S. corn plantings at a four-year and potentially a seven-year high. Soybean acres should make a substantial recovery from 2019 but remain well off the highs from the previous two years.

The U.S. Department of Agriculture last month tentatively slated U.S. corn and soybean acres at 94 million and 85 million, respectively, though its statistics branch will publish the results of its farmer planting survey next Tuesday. Last week, commodity brokerage and analytical firm Allendale Inc. published its survey results of 94.631 million corn and 83.74 million soybean acres.

I recently posted a corn acreage poll on Twitter that ended the following morning, and the results were slightly different. Of the 1,258 respondents, some 37 per cent placed corn acres below 93 million, and the second-place category of 93 million to 94 million received 28 per cent of the vote.

Some 19 per cent voted 94 million to 95 million and the least popular category of more than 95 million had 16 per cent support.

Farmers planted 94 million corn acres in 2016, and if they plant more than that this year, it would be the largest corn acreage since 95.4 million in 2013. December corn futures averaged US$5.58 per bushel in March 2013.

The recent five-year average for corn plantings is 90.15 million acres, including last year’s 89.7 million, which was down three per cent from farmers’ March intentions. Soybean plantings fell 10 per cent from March intentions last year to 76.1 million acres, an eight-year low. Farmers pushed harder on corn through last year’s poor planting conditions because of its profitability advantage versus soybeans.

Nearly 16 million corn and soybean acres sat idle in 2019 due to the excessive rains, and most of those acres should return to production this year, meaning that corn and soybean acres are nearly 100 per cent guaranteed to rise over last year, regardless of prices.

Soybean plantings hit a record 90.2 million acres in 2017 and 2018 acres were just a million below that, but otherwise the largest area planted was 83.5 million acres in 2016.

New-crop futures, December corn and November soybeans, often guide farmers on planting decisions, especially in fringe areas of the Corn Belt that are less locked in to rotations.

The ratio of soybeans to corn is currently around 2.38 to 2.39, and values of 2.4 start to favour soybeans. Values 2.5 and above more definitively favour the planting of soybeans, while values under 2.3 lean toward corn. The ratio hit 2.3 at the start of last week, the lowest of the year so far.

But it is hard to know how much that ratio matters when both corn and soybean prices are at historic lows for the time of year.

Not only are new-crop corn prices extremely light for March, but last week’s lows were also just about the lowest new-crop prices since 2007 to occur outside of the late summer or harvest season, when futures tend to bottom.

That is also true for November soybeans as recent prices have rarely been as low in the last decade, and those lows usually occurred between July and November. November 2020 beans bottomed at US$8.36-1/4 per bushel in mid-March, but they were trading up around 40 cents March 25. However, that is nearly the lowest new-crop price during March since 2009.

Commodity and financial markets have had a rough time recently dealing with the uncertainties around the coronavirus pandemic and the associated halt in economic activity. Corn has been under pressure due to falling ethanol margins, following the plunge in crude oil prices as global travel demand dries up.

In exactly one month, about one-fifth of the U.S. corn crop should be planted according to recent averages, excluding 2019. Soil moisture is above average across the entire Corn Belt, but the heavy moisture is less concentrated in the highest-production areas relative to last year, when saturated soils and persistent rains caused record delays in corn and soybean planting.

The Dakotas are currently wetter than one year ago, but the moisture anomaly in top corn grower Iowa is significantly down from a year ago, as are the moisture levels in much of the eastern Corn Belt. Exactly one year ago, Nebraska, Iowa, and surrounding states had just begun dealing with fallout from the historic flooding of the Missouri and Platte rivers that caused billions of dollars in damages.

Weather models suggest the U.S. Midwest may end March on a wetter-than-normal note, and the U.S. government predicted last week that April precipitation may be above average in Iowa and the western Corn Belt. Corn planting is heaviest in the latter half of April.

Weather is not the only factor that could impact farmers’ plans this year, but coronavirus is not expected to be one of them. As of Wednesday, 18 U.S. states, including Illinois, Indiana and Ohio, were under statewide orders to shelter in place. However, agriculture has been deemed an essential industry exempt from the orders.

Iowa’s secretary of agriculture told Reuters he expects a normal planting season as far as the virus is concerned.

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Soybeans also advanced on the weather worries and wheat closed higher after a choppy session.

Chicago Board of Trade July corn settled up 11 cents at $4.53 per bushel after reaching $4.57-1/4, a contract high and the highest for a most-active contract since June 2014.

CBOT July soybeans ended up 8-3/4 cents at $8.96-3/4 a bushel. July soft red winter wheat finished up three cents at $5.38-1/2 a bushel after touching $5.44, the contract’s highest since Dec. 19.

Corn set the tone, with the nearby July contract gaining sharply against back months on spreads, reflecting firm cash markets.

Until recently, big corn surpluses from a series of bumper U.S. harvests had traders selling nearby contracts and buying back months.

That trend has reversed, however, as unprecedented planting delays in the Corn Belt raised questions about the potential size of the 2019 crop.

End-users of corn, such as producers of livestock feed and ethanol, have been bidding up for old-crop supplies in the cash market this week, especially in the eastern Midwest, where farmers have been hit hard by unrelenting spring rains.

That demand has sent the nearby CBOT July contract surging against back months as traders unwind short July/long September futures.

“These eastern Corn Belt end-users, they are deathly afraid that they are not going to have any corn to draw on. That’s why the spread has just exploded,” said Tom Fritz, a partner at EFG Group in Chicago.

CBOT soybeans rose on outlooks for rain over the next 15 days, with the heaviest precipitation expected in Missouri, Illinois, Indiana and Ohio.

“The persistent wet weather in these areas will severely limit remaining soybean planting and increase the potential for significant declines in soybean acreage, in addition to the large declines in corn acreage that are now unavoidable,” space technology company Maxar said in a daily weather note.

CBOT wheat futures closed modestly higher but dipped lower at times during the session on profit-taking after the July contract reached its six-month peak.

K.C. July hard red winter wheat posted a larger gain, supported by expectations of a pick-up in the amount of wheat fed to cattle as a cost-effective alternative to corn.

Front-month CBOT corn on Friday closed at a discount of 23-1/4 cents a bushel to front-month K.C. wheat, the narrowest in three years.

“Every feedlot I have is looking at feeding wheat now,” said Dan Basse, president of AgResource Co. in Chicago. “At these kinds of spreads, people are really going to jump on feeding wheat.”

— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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Wheat futures also ended nearly flat while soybeans closed higher.

Chicago Board of Trade July corn settled up 3/4 cent at $3.69-1/2 per bushel, after reaching $3.80 a bushel in midday trading, the contract’s highest since March 29 (all figures US$).

Corn firmed on forecasts for rains to return to the U.S. Corn Belt this weekend and persist next week.

But the rally stalled as the July contract reached $3.80 and the new-crop December contract approached $4 a bushel, high enough to entice farmers to sell.

“This is a classic transfer of risk, where funds were covering their short positions and the farmer was happy to sell to them,” said Terry Linn, an analyst with Linn + Associates, a Chicago brokerage.

CBOT July soybeans settled up four cents at $8.35-1/2 per bushel, after rising to $8.48-1/4 in midday trading.

CBOT July soft red winter wheat ended up 1/4 cent at $4.48-3/4 per bushel, while K.C. July hard red winter wheat fell 6-3/4 cents to $4.02 a bushel and Minneapolis Grain Exchange July spring wheat closed down eight cents at $5.15-1/4 a bushel.

Corn futures have risen sharply this week, with the July corn contract surging 37 cents from a contract low of $3.43 on Monday to Wednesday’s high of $3.80, as U.S. planting worries prompted funds to unwind a portion of their massive net short position.

“We’re a little bit over-extended on some big short-covering. But if the (weather) forecast verifies, there is going to be some significant acreage loss,” said Dan Cekander, president of DC Analysis.

“There is some planting going on, but it looks like a pretty limited window,” Cekander said.

U.S. farmers seeded 30 per cent of the U.S. 2019 corn crop by Sunday, the government said, lagging the five-year average of 66 per cent. The soybean crop was nine per cent planted, behind the five-year average of 29 per cent.

CBOT soybeans extended their rally from Tuesday, after U.S. President Donald Trump eased concerns over the U.S.-China tariff war.

But bearish monthly soy crushing data hung over the market, capping gains. The National Oilseed Processors Association said its U.S. members crushed 159.99 million bushels of soybeans in April, down from 170 million in March and below an average of analyst expectations for 161.6 million.

Also, China’s sow herd fell by 22.3 per cent in April from a year earlier, the ministry of agriculture and rural affairs said, underscoring the effects of an epidemic of incurable African swine fever.

The decrease in China’s hog herd, the world’s largest, suggests a drop in demand for soy-based animal feed.

Wheat drew support from news that drought-hit Australia will import its first shipment of wheat in more than a decade, from Canada.

— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Sybille de La Hamaide in Paris and Naveen Thukral in Singapore.

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Corn futures also fell as technical selling more than offset support from strong demand and potential harvest delays. Wheat prices drifted lower with corn and soybeans after rallying more than two per cent a day earlier on worries about tightening global supplies.

Chicago Board of Trade November soybeans touched a near-six-week high during the session, but ended down 4-1/2 cents at $8.61-1/2 per bushel as buying interest faded (all figures US$).

December corn closed down 2-3/4 cents at $3.64-3/4 a bushel after failing to top Tuesday’s three-week high.

Both contracts slipped below their 50-day moving averages after closing at or above the key technical level on Tuesday for the first time since mid-August.

Forecasts for rain across the Corn Belt over the next 10 days have raised concern that corn and soybean harvests that had been ahead of the normal pace could fall behind, which raises the risk crops could be damaged or difficult to harvest.

“The northern half of the growing area keeps getting rain and harvest delays. And the longer-term weather forecast doesn’t look all that great,” said Ted Seifried, chief agricultural market strategist for Zaner Group in Chicago.

CBOT December wheat fell four cents to $5.15-1/4 a bushel after earlier failing to break through technical resistance at its 200-day moving average.

Russia’s agriculture safety watchdog said it has no immediate plans to suspend the operation of grain loading points in Black Sea ports near the city of Krasnodar.

Wheat futures rallied a day earlier after the watchdog said it could temporarily suspend operations of 30 inland grain loading points in two of Russia’s top grain exporting regions — Krasnodar and Rostov.

“The idea of a slowdown in Russian shipments was in the air for several weeks in view of the current high shipment pace leading to high prices on the Russian internal market,” consultancy Agritel said in a note.

A sharp fall in Russian wheat production from last year’s record crop has fueled speculation about potential government export restrictions. That speculation comes amid worries about weather-reduced crops in other key export regions around the world.

Australia recorded its driest September on record and the country is expecting its smallest wheat crop in a decade.

— Karl Plume reports on agriculture and commodity markets for Reuters from Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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