Corn
Price action: December corn futures climbed 3 3/4 cents to $4.14 1/2 but marked a 3/4 cent loss on the week.
5-day outlook: Corn futures saw relative strength today compared to wheat and soybeans after trading in a tight range for most of the week. Export demand continues to impress, as USDA reported daily corn sales of 781,322 MT to Mexico. Of the total, 715,800 MT was for 2024-25 and 65,532 MT for 2025-26. The coming week will shed some light whether the recent uptick in export demand was largely precautionary ahead of Tuesday’s election and ensuing change in administration or if it is end-users stocking up on supplies at value levels. Demand overall has been robust as prices are trading near four-year lows. Ethanol use remains quite robust as analysts expect USDA to report corn-for-ethanol use totaling 447.8 million bu. in September in this afternoon’s report, the results of which will be in Evening Report.
30-day outlook: This year’s corn crop was a tale of the haves and have nots. It is clear the earlier planted corn crop was impressive, but reports of later planted corn have been disappointing, heavily riddled with disease and insect pressure. Harvest will be wrapping up here in the next couple of weeks and the dust will settle in seeing how corn supplies stack up to what is anticipated. USDA will give an update on production in next week’s Crop Production Report on Friday. Large changes are not anticipated at this juncture, though we do maintain a lower yield estimate than USDA on lower populations and ear counts. The low moisture content of a lot of harvested acres is also likely to weigh on yield, though marginally, as low moisture will take off a couple bushels per acre compared to what it could have been.
90-day outlook: South American production is likely to play a substantial role in price action over the coming quarter. Weather in Brazil has recently turned more wet, encouraging producers to plant soybeans at a rapid pace. That will push the harvest date sooner than we anticipated previously, enabling the planting of safrinha corn within the ideal window. The world balance sheet is seen as contracting in 2024-25 despite a bumper crop in the U.S. If production faces any hiccups in either Argentina or Brazil, it could continue to drive importers to the U.S. for corn purchases, continuing to underpin prices. On the other hand, if favorable weather persists in Brazil throughout their growing season, importers could look to Brazil to purchase cheaper corn, drawing from U.S. demand.
What to do: Get current with advised sales.
Hedgers: You should be 20% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 20% sold on 2024-crop.
Soybeans
Price action: January soybeans fell 3/4 cent to $9.93 3/4 and gave up 2 1/4 cents on the week. December soymeal closed $4.20 lower at $295.30, marking a $10.50 weekly loss, while December soyoil rallied 116 points to 46.30 cents, securing a 215-point weekly gain.
5-day outlook: Rallying soyoil futures lifted the soy complex this week but lost some steam after reaching a four-month intraday high in early trade, pressuring soybean futures from session highs. On the converse, soymeal futures edged lower for the ninth straight session to a contract low as bears continue their dominance. However, persisting oversold conditions could spur some corrective buying next week, though the marketplace will remain focused on planting progress in Brazil, which has advanced notably of late amid improved moisture, as well as next week’s election. Look for a mostly subdued tone as traders weigh the pros and cons of each candidate and their likely policy choices in the event of a victory.
30-day outlook: Weather in South America will continue to be a market driver over the next several weeks as Brazil producers continue their planting efforts and soybean planting in Argentina commences. World Weather Inc. notes regular rounds of showers and thunderstorms will continue through the next two weeks in central and most of northern Brazil and central and northern Paraguay, while southern Brazil and southern Paraguay will not be as wet as other areas and much of the region will dry down at times. Argentina is also expected to see regular rounds of showers and thunderstorms over the next two weeks, slowing fieldwork at times while improving soil moisture for spring and summer crop development throughout the country. The forecaster notes widespread soaking rains are not expected during the next two weeks, allowing some fieldwork to advance around the rain.
90-day outlook: U.S. soybean exports have been quite notable as of late, though there is looming speculation importing countries are securing purchases ahead of the election, with concerns of growing trade tensions. However, a more than $1.00 drop from the late September high makes U.S. soybeans a value buy on the global marketplace, leaving some ambiguity around the nature of recent purchases and if they will continue into the end of the year. Moreover, regardless of the election, traders will continue to closely monitor inflation and the U.S. dollar, with persisting strength curbing the competitiveness of U.S. commodities.
What to do: Get current with advised sales.
Hedgers: You should be 20% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 20% sold on 2024-crop.
Wheat
Price action: December SRW futures sunk 2 1/2 cents to $5.68, losing a penny on the week. December HRW futures dropped 2 1/2 cents to $5.66 3/4, down 5 1/4 cents on the week. December HRS futures fell 4 1/2 cents to $5.99 3/4 and for the week fell 5 1/2 cents.
5-day outlook: Wheat futures failed to maintain overnight strength as sellers took hold of the session after this morning’s open. Price action since the start of October has been remarkably orderly, trending lower at about 11 cents per week on average. Part of that weakness is likely due to persistent selling pressure in the corn and soy markets throughout the month as hedge pressure drove prices lower. Corn prices hold a bearish bias in November, but given the rapid pace of harvest this year, some of that hedge pressure likely occurred in October which leaves room for strength in November. Still, given the bearish technical outlook and December SRW futures ending the week near resistance, bulls will be fighting an uphill battle over the coming week.
30-day outlook: Winter wheat ratings were noted as having the second-worst ever start in this week’s USDA Crop Progress Report. The dryness throughout winter wheat acres, particularly HRW acres, will garner a lot of attention over the coming month. Rains developed over the course of this week and more rain is expected to fall over the weekend and next week in the Plains. How the winter wheat crop reacts to that precip will be telling. Historically, when the winter wheat crop starts off poorly, either abandonment is above average or yield is below average (but not necessarily both). Traders will keep a close eye on the forecast and condition ratings over the coming month to see how the U.S. winter crop establishes.
90-day outlook: The world wheat balance sheet continues to garner attention, especially as winter wheat across the globe has struggled with little rain and poor establishment, but given such a long lead time to harvest, traders are skeptical to take on bullish trades as the poor supply will take months to show its affects. As production prospects are better realized for the 2024-25 crop year, traders are likely to increase in their assertiveness in putting on new trades. World wheat prices are on the rise, most notably out of Russia, who has not only increased their prices, but the taxes on the exports, making U.S. wheat more competitive price wise, albeit slowly.
What to do: Get current with advised sales.
Hedgers: You should be 70% sold in the cash market for 2024 crop. You should have 20% forward sold for harvest delivery in 2025.
Cash-only marketers: You should be 70% sold for the 2024 crop. You should also be 20% sold for harvest delivery for expected 2025-crop.
Cotton
Price action: December cotton rose 60 points to 70.17 cents but gave up 49 points on the week.
5-day outlook: December cotton modestly favored the upside to end the week as technical resistance continued to curb buying interest. Moreover, crude oil strength was largely offset by gains in the U.S. dollar following weaker-than-expected October Payroll and ISM Manufacturing results were attributed to two hurricanes and labor strikes last month. Next week’s election will likely bring a pause to the marketplace, with technicals indicating a continued grind lower.
30-day outlook: USDA reported the cotton harvest was 52% complete as of last Sunday, which was an eight-point advance from the previous week. The crop’s “good” to “excellent” rating dropped four points to 22%, while the “poor” to “very poor” rating rose three points to 36%. With harvest efforts remaining, traders will continue to closely monitor U.S. weather. World Weather Inc. reports West Texas and some neighboring areas in the Texas Panhandle and southwestern Oklahoma will receive rain periodically over the coming week disrupting cotton maturation and harvest. The moisture may also discolor some of the cotton fiber. Meanwhile, harvest in the Blacklands may also be disrupted with unharvested crops also vulnerable to some moderate and heavy rain. The forecaster notes harvest in the Delta is winding down, while that in California and Arizona will continue to advance in a favorable weather environment this week.
90-day outlook: Cotton exports have stabilized recently, with weekly upland sales totaling 189,400 RB during the week ended Oct. 24, which were up 12% from the previous week and 47% from the four-week average. Meanwhile, shipments during the week rose to 134,000 RB, marking a 37% rise from the previous week and 50% from the four-week average. Traders will continue to focus on export business as the marketing-year progresses, with a particular eye on the U.S. dollar, which will take direction from inflation. Heightening global trade tensions will also remain a concern in the wake of the presidential election.
What to do: Get current with advised sales and hedges.
Hedgers: You have 15% of 2024-crop production hedged in December futures at 69.84 cents. You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.