-Weakening corn prices prompting Chinese feed ration switches back to corn
-USDA reports large daily soybean sales
-NOPA crush report today at 11:00 AM CT
-Rains benefiting Argentine corn planting
-Export Sales generally decent
Chinese corn prices have been notably on the defensive of late as the new crop harvest rolls on, moving back to even with, or falling below, wheat prices in key feed areas for the first time in a year in some locations. After trading at a heavy premium to wheat in Shandong since the first of the year, corn prices are now even with wheat once again, prompting many livestock feeders to start reducing wheat inclusion in rations and moving corn back in at more typical levels. Some areas in northern China were reportedly seeing poultry feed mix as high at 40% wheat, but recently cut back to around 20%. Declining corn prices, while positive for feed demand prospects, may be negative for import prospects/needs, at least in the near term.
A large daily soybean sales announcement was finally seen today with USDA reporting 855k tonnes being sold to unknown/China. Specifically, 132k tonnes was reported to China, 396k to unknown, while 327k tonnes was late-reported sales to unknown.
NOPA’s monthly crush report will be out today at 11:00 AM CT. The average estimate of September soybean crush by NOPA members is 155.1 million bushels (148.0-162.8 million range of ideas) vs last year’s 161.5 million and 158.8 million in August. The average estimate of end September soybean oil stocks held by NOPA members is 1.663 billion pounds (1.625-1.718 billion range of ideas), little changed from 1.668 billion in August and compares to 1.433 billion pounds last year.
China will restart auctions of state reserve wheat on October 20 with 1 MMT to be offered. The last wheat auctions were held in May.
The Buenos Aires Grains Exchange said rains in central growing areas have been beneficial of late, allowing planting to move along and is now 23% complete.
French soft wheat planting is proceeding without issue in the early stages with 13% complete, up from 4% the previous week and in line with average of 11%. Corn harvest remains very slow, though, given the late crop, at 15% complete vs 7% the previous week and last year’s drought-impacted 62%. Weather looks favorable for the coming week to aid harvest activity.
Malaysian palm oil/product exports during Oct 1-15 of 724k tonnes were down solidly from 814k tonnes exported during Sept 1-15 according to AmSpec. Full month September exports of 1.628 MMT were a 9-month high and up sharply from 1.219 MMT.
Please see our Market Insights post at https://portal.rjobrien.com/MarketInsights/Blog/Read/45490 for details on today’s USDA Export Sales report.
U.S. corn sales were 1.040 MMT (40.9 million bushels), in line with market expectations of 700k-1.6 MMT, down slightly from the previous week’s 49.9 million and well above year ago poor same-week sales of 25.8 million bushels, which were the lowest of the first 10 weeks of the marketing year last year. Total commitments of 1.087 billion bushels are up 4% from last year, but very likely to fall below year ago levels in the coming weeks as corn sales over the next three weeks last year averaged 88 million bushels/week.
U.S. soybean sales last week of 1.148 MMT (42.2 mil bu) were in line with expectations of 600k-1.4 MMT and continued the steady pace of sales seen over the first six weeks of 2021/22 which have averaged 41.8 million bushels/week. Total commitments of 670 million bushels are
now down 39% from last year’s 1.585 billion. U.S. wheat sales last week were solid at 568k tonnes (20.9 million bushels), slightly above the range of market expectations of 250-500k tonnes, up solidly from the previous week’s 12.1 million bushels and were the 2nd best of 19 weeks of the 2021/22 marketing year so far.
In the first full week of the 2021/22 soybean product marketing years, sales were respectable at 365k tonnes for soybean meal, a bit above expectations of 100-320k tonnes, while soybean oil sales of 19.8k tonnes were within expectations of -5 to +30k tonnes.