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Weekly Grain Movement – Soybeans are solid, but

Corn and wheat post another round of lackluster export inspection data

The latest round of grain export inspection data from USDA, out Monday morning, showcased another decent round of soybean numbers but didn’t otherwise have a lot of bullish news for traders to chew on.

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Soybean export inspections reached 38.2 million bushels for the week ending October 3, which was a small improvement over the prior week’s tally of 36.1 million bushels but behind trade estimates of 42.3 million bushels. The weekly rate needed to match USDA forecasts moved slightly lower, to 34.1 million bushels, while cumulative totals are holding onto a 17% lead from a year ago, with 154 million bushels.

“The surprise for soybeans came from China,” according to Farm Futures senior grain market analyst Bryce Knorr. “Buyers there continue to load out relatively small amounts previous purchases, just 5.1 million bushels done out of the Gulf. USDA separately announced more sales Monday under its daily reporting system for large purchases. In addition to 8.8 million for unknown destinations, China bought another 7.3 million, bringing its total commitments to 140 million bushels for the current marketing year.”

Even so, a raft of other countries took up the slack, which has helped to firm basis on both the river system and rail lines headed to the Pacific Northwest, Knorr notes.

“With Brazilian supplies running thin, other customers are making sure they have some of their needs covered, just in case U.S. production is sharply lower or a trade deal with China gets done in the wake of talks this week,” he says.

China and Mexico shared the lead as top destinations for U.S. soybean export inspections last week, with 5.1 million bushels apiece. Other leading destinations included the Netherlands (4.5 million), Spain (4.4 million), Egypt (3.9 million) and Vietnam (2.9 million).

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Corn export inspections also improved week-over-week, moving from 16.6 million bushels up to 18.4 million bushels while falling below the average trade guess of 23.6 million bushels. The weekly rate needed to match USDA forecasts moved higher, to 39.4 million bushels, while cumulative totals for the 2019/20 marketing year are only at 79 million bushels, versus 233 million bushels this time a year ago.

“Corn and wheat inspections remained slow again last week, coming in at the bottom of trade estimates and failing to reach USDA’s forecast for the 2019 marketing years,” Knorr says. “That could convince USDA to lower its forecast for shipments of both crops when it updates supply and demand estimates October 10.”

Mexico by far led all destinations for corn export inspections last week, with 7.2 million bushels. Other top destinations included China (2.3 million), Costa Rica (2.0 million) and Colombia (1.7 million).

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Wheat export inspections also turned in a lackluster total last week, at just 14.2 million bushels. That was moderately behind the prior week’s tally of 18.5 million bushels and on the low end of trade estimates that ranged between 14 million and 22 million bushels. The weekly rate needed to meet USDA forecasts moved up to 18.7 million bushels, although cumulative 2019/20 totals of 327 million bushels remain 21% higher than a year ago.

The Philippines led all destinations for wheat export inspections last week, with 3.2 million bushels. Other top destinations included Mexico (2.7 million), Vietnam (2.1 million), Italy (2.0 million) and Yemen (1.9 million).

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