Good morning!
Corn and soybeans weaker, wheat firms overnight... Corn and soybeans faced fresh selling pressure during overnight trade, while wheat firmed amid light corrective buying. As of 6:30 a.m. CT, corn futures are trading mostly 2 cents lower, soybeans are mostly 9 cents lower, SRW wheat is 2 to 3 cents higher, while HRW and HRS wheat are 5 to 6 cents higher. Front-month crude oil futures are around $1.50 lower and the U.S. dollar index is down more than 100 points.
Weekly Export Sales Report out this morning... For the week ended Sept. 28, traders expect:
| 2023-24 expectations (in MT) | Last week (in MT) |
Corn | 1,400,000-2,000,000 | 841,783 |
Wheat | 250,000-600,000 | 544,539 |
Soybeans | 400,000-900,000 | 672,213 |
Soymeal | 225,000-525,000 | 375,690 |
Soyoil | 0-10,000 | 100 |
Argentina’s soy crushers face ‘disaster’... Argentina’s soybean processing plants are running out of soybeans after a historic drought cut the crop in half, the head of the country’s grains export chamber told Reuters, which will leave well over two-thirds of factory capacity idle. The head of the grain exporters and crushing chamber CIARA-CEC said there would be just 3 MMT of soybeans left for crushers to process by the end of this month. According to Argentina’s ag ministry, soybean crush volume plunged 27% from year-ago to 19.6 MMT through the first eight months of this year, despite record soybean imports from neighboring countries. He also said he did not expect any officially declared wheat sales in the months ahead for the 2023-24 harvest as export contracts from 2022-23 are still being fulfilled after the government allowed exporters to push them back due to the drought.
UK accuses Russia of plotting to sabotage Ukrainian grain vessels... Britain accused Russia of plotting to sabotage civilian cargo ships loaded with Ukrainian grain by planting sea mines on the approaches to the country’s Black Sea ports. Based on what it said was declassified intelligence, the UK said Russia did not want to directly attack merchant vessels using Ukraine’s newly created humanitarian corridor with missiles, but instead try to destroy them covertly. Russia would then seek to blame Ukraine for the loss of any shipping in an attempt to evade responsibility, the British Foreign Office said.
Dryness may trim Ukraine’s winter wheat sowings... Ukraine is likely to sow less winter wheat than it initially expected for the 2024 harvest due to the prolonged absence of rain across most regions, Agriculture Minister Mykola Solsky said. However, he said it “is not a critical story.” Solsky gave no exact figure for the winter wheat acreage that could be sown this year. The ministry has previously forecast planted area of 4.4 million hectares. As of Oct. 3, Ukrainian farmers had seeded 1.7 million hectares to winter wheat.
Coceral cuts EU wheat crop estimate... European grain trade association Coceral lowered its estimate of this year’s soft wheat crop in the European Union and Britain to 141.0 MMT from 142.4 MMT projected in June. Coceral also lowered its estimates for this year’s barley (54.7 MMT, down 1.9 MMT), corn (60.8 MMT, down 500,000 MT) and rapeseed (20.4 MMT, down 600,000 MT) crops, saying dryness in northern Europe had had a bigger impact than expected on grain harvests.
House Republicans enter Speaker race amid ongoing uncertainty... Following the unexpected removal of Rep. Kevin McCarthy (R-Calif.) as Speaker of the House, and the temporary appointment of Rep. Patrick McHenry (R-N.C.) as acting Speaker, Republican lawmakers are facing challenges in selecting a successor. Notably, some House Republicans, including Judiciary Committee Chairman Jim Jordan (R-Ohio) and Majority Leader Steve Scalise (R-La.), have already expressed their interest in running for the position. Additionally, there have been discussions about alternative candidates, including former President Donald Trump, although the likelihood of a non-member becoming Speaker is minimal. The ongoing process has raised the possibility that the selection of a new Speaker may extend over several weeks, according to Rep. Garret Graves (R-La). Of note: It didn’t take long for the general ag media to note that neither Jordan nor Scalise has been very friendly toward ag policy in the past, especially compared with dethroned McCarthy. Bottom line: There is no clear alternative to McCarthy who would have the support needed to win. Also adding to the contentious environment is the pressure to reach an agreement on government funding, which is set to expire on Nov. 17. With many committee meetings canceled, members and aides are questioning how they’ll avert a shutdown when there is so much uncertainty about the basic rules of House operation.
USDA seeks emergency clearance for Hawaiian fire damage survey... USDA’s National Agricultural Statistics Service (NASS) is urgently requesting clearance and review from the Office of Management and Budget (OMB) to conduct a special survey aimed at assessing damage caused by wildfires and high winds in La Haina, Hawaii, in August. While some farms suffered physical damage, NASS highlights that many others were adversely affected by the loss of markets and agritourism income. The Hawaii Department of Agriculture (HDOA) has enlisted NASS to conduct this disaster survey, which will account for various losses, including crops, livestock, sales, equipment, infrastructure and more. The voluntary survey’s objective is to quantify economic losses, damages on an acreage and livestock basis, impacts on agricultural infrastructure and the well-being of agricultural workers. Comments on the Hawaii Agricultural Disaster Survey will be accepted until Oct. 10, and NASS has requested OMB decide within five days after the comment period concludes.
Mexico reports H5N1 bird flu in wild duck... A case of H5N1 avian influenza was found in a “clinically healthy” migratory duck in the state of Jalisco, animal safety agency Senasica, which is part of Mexico’s ag ministry, said. This case does not indicate the occurrence of a highly pathogenic avian influenza (HPAI) outbreak. The announcement coincides with the Mexican government’s official statement that the country has been declared H5N1 free following the initiation of a vaccination campaign in high-risk areas. Senasica has clarified that the presence of H5N1 in a wild bird does not contradict the government’s declaration of being H5N1 free, and no cases have been identified in commercial poultry as of now.
Cash cattle trade lower... The sharp break in futures the first two days this week combined with packers having access to fresh contract supplies caused some feedlots to sell cattle in the negotiated market at lower prices and earlier than expected. Initial cash cattle trade occurred at mostly $1 lower prices, with activity reported at those levels in both the Southern Plains and northern market.
Cash hog decline slowing, pork cutout modestly firms... The CME lean hog index is down another 28 cents to $84.28, though that’s the smallest decline in the past week. The pork cutout value firmed 3 cents on Wednesday, halting the sharp decline the past two days. While cash fundamentals continue to weaken, traders will watch to see if prices may be stabilizing.
Overnight demand news... South Korea purchased 198,000 MT of corn, with one cargo expected to be sourced from Romania, another from South America and the other from either South America or South Africa. Japan purchased 91,234 MT of milling wheat in its weekly tender, including 23,987 MT U.S., 32,974 MT Canadian and 34,273 MT Australian.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
- 7:30 a.m. Weekly Export Sales — FAS