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Morning Market Review for October 26, 2021

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Profit-taking sends grains lower. (Comments are updated by 7:30 a.m. Central Time.)

Wheat pulls back on yesterday’s highs despite low winter wheat condition ratings

  • Corn down 1-2 cents
  • Soybeans 2-4 cents; Soymeal down $1.70/ton; Soyoil down $0.04/lb
  • Chicago wheat down 6 cents; Kansas City wheat down 6-7 cents; Minneapolis wheat down 4-5 cents

*Prices as of 6:50am CDT.

Good Morning! How is harvest progressing on your farm? Tell us all about it! Click here to take our ongoing Feedback from the Field survey on 2021 crop conditions to share your harvest progress (or hunting plans!). Our Google Map, updated daily, provides all past responses for farm readers, from farmers.

Corn

A quiet night in the overnight markets left corn prices $0.01-$0.02/bushel lower this morning. Corn prices largely followed price movement in the wheat complex overnight, though some weakness can be largely attributed to faster than expected weekly harvest rates following USDA’s latest Crop Progress report issued yesterday and favorable corn harvest conditions reported from the European Union overnight.

A USDA attaché stationed in Buenos Aires, Argentina estimates the 2021/22 corn crop will surpass current forecasts by USDA on rising acreages and improvements to soil moisture conditions. The post reports 25% of the crop has been planted so far and that higher input prices are not yet a deterrent to 2021/22 production prospects.

The attaché expects Argentina will harvest 2.15 billion bushels of corn in 2021/22, up from USDA’s current estimate of 2.09 billion bushels. The supply uptick will be absorbed by the export market with the attaché’s report estimating 2021/22 Argentine corn exports 78 million bushels higher than USDA’s current forecasts to 1.57 billion bushels.

Argentina is the world’s third largest exporter of corn, following the U.S. and Brazil. The post estimates 2021/22 Argentine wheat production at 735 million bushels, unchanged from USDA’s current projections.

Yesterday’s Crop Progress report from USDA saw harvest rates continue to advance across the Midwest and despite some heavy showers late in the week, the metric pulled away from the five-year average. For the week ending October 24, USDA found 66% of the U.S. corn crop to be harvested, up 14% from the previous week and 13% ahead of the five-year average.

Last week’s showers had led trade analysts to believe the weekly pace would be slightly less rapid. So USDA’s reading of 66% complete upended trade guesses, which ranged between 62%-68% complete and averaged 65% for the week.

With both corn and soybean crops over halfway harvested, USDA has discontinued weekly condition ratings for the season.

Soybeans

Soybean futures edged $0.02-$0.04/bushel lower overnight on a round of profit-taking following yesterday’s rally. Losses were capped by tight global edible oil supplies.

Soybean harvest for the week ending October 24 advanced to 73% complete, slightly lower than analysts had been expecting prior to USDA releasing updated figures yesterday. Week over week, harvest activity advanced 13% and held steady at 1% ahead of analyst expectations.

However, rain delays, brittle pods, and simultaneous corn harvesting activities pulled the weekly soybean harvest rate back towards the five-year average. Last week, harvest paces were 5% ahead of the five-year average. The week before that gap measured 9%.

But yesterday’s report found weekly soybean harvest rates only 3% higher than the five-year average for the same reporting period. A soggy fall in the Eastern Corn Belt has literally dampened harvest paces, though with the majority of harvest activity beginning to wind down, it likely won’t have too significant of an impact on yields.

Wheat

Profit-taking also hit the wheat complex overnight, backing futures prices off yesterday’s two-month highs recorded for the Chicago contracts. Losses were capped by surprisingly lower results for U.S. winter wheat conditions and a weaker dollar.

The world’s top wheat importer reports having comfortable wheat supplies on hand for the next six months. Egypt’s cabinet reported having enough state wheat in government reserves overnight over the next half year.

Egyptian wheat imports account for 7% of the world’s wheat purchases. The news comes as a signal that rapid international wheat buying paces may be cooling as prices in the wheat complex rise to multi-year highs amid tightening global supplies.

Winter wheat planting progress rose 10% from the previous week to 80% complete. The weekly estimate was perfectly aligned with the five-year average for the same reporting period and was only 1% under analyst expectations leading up to the report’s release.

Much of the country’s hard red winter wheat and white winter wheat in the Plains and Pacific Northwest, respectively, is already in the ground. Much of the remaining winter wheat sowing is centered east of the Mississippi River, where soft red winter wheat is primarily grown.

Rains over the past few weeks have helped coax along emergence rates, though slow soft red winter wheat planting paces are restraining emergence rates relative to the five-year average. For the week ending October 24, 55% of the crop had emerged, up 11% from the previous week but 4% lower than the five-year average.

This marked the first week in which USDA reported on condition ratings for the 2022 winter wheat crop. As of Sunday, 46% of the young crop was found to be in good to excellent condition. The rating was 5% higher than conditions the same time last year and came in well under analysts’ expectations of 54% good to excellent and completely outside the anticipated trade range of 46%-62% good to excellent.

Weather

Mostly clear skies today will allow for harvest activity to continue for now, according to NOAA’s short-range forecasts. A storm system developing in the Northern Rockies will push east into the Upper Plains late this evening, with significant storm activity expected to batter the Southern Plains overnight.

Showers will shift east and settle over the Mississippi River Valley by tomorrow afternoon, likely slowing harvest progress along the way as the system lingers over the region through Thursday.

Today’s showers will bring about a half of inch of precipitation to the Plains, with the Southern Plains receiving up to an inch of accumulation with this evening’s storms.

Financials

S&P 500 futures traded 0.40% higher (+18.250 points) to $4,576.25 at last glance as robust corporate earnings overshadowed concerns about pandemic recovery and high inflation.

Also worth a read on our website, FarmFutures.com

Morning Ag Commodity Prices - 10/26/2021
Contract Units High Low Last Net Change % Change
DEC '21 CORN $ / BSH  5.395 5.355 5.3625 -0.0175 -0.33%
MAR '22 CORN $ / BSH  5.48 5.445 5.45 -0.0175 -0.32%
MAY '22 CORN $ / BSH  5.5175 5.485 5.49 -0.015 -0.27%
JUL '22 CORN $ / BSH  5.5275 5.4925 5.4975 -0.015 -0.27%
SEP '22 CORN $ / BSH  5.3675 5.345 5.35 -0.005 -0.09%
DEC '22 CORN $ / BSH  5.34 5.315 5.33 -0.0025 -0.05%
MAR '23 CORN $ / BSH  5.3975 5.3925 5.3975 0 0.00%
NOV '21 SOYBEANS $ / BSH  12.385 12.325 12.335 -0.0375 -0.30%
JAN '22 SOYBEANS $ / BSH  12.485 12.4225 12.435 -0.035 -0.28%
MAR '22 SOYBEANS $ / BSH  12.5775 12.515 12.5275 -0.035 -0.28%
MAY '22 SOYBEANS $ / BSH  12.6625 12.6075 12.6175 -0.0325 -0.26%
JUL '22 SOYBEANS $ / BSH  12.7025 12.655 12.6625 -0.03 -0.24%
AUG '22 SOYBEANS $ / BSH  12.6475 #N/A 12.6375 0 0.00%
SEP '22 SOYBEANS $ / BSH  12.4375 12.435 12.4375 0.005 0.04%
NOV '22 SOYBEANS $ / BSH  12.3475 12.315 12.32 -0.02 -0.16%
JAN '23 SOYBEANS $ / BSH  12.345 #N/A 12.345 0 0.00%
DEC '21 SOYBEAN OIL  $ / LB 63.5 62.95 63.13 -0.01 -0.02%
JAN '22 SOYBEAN OIL  $ / LB 62.96 62.48 62.66 0.03 0.05%
DEC '21 SOY MEAL $ / TON 327.7 325 325.4 -1.8 -0.55%
JAN '22 SOY MEAL $ / TON 326.1 323.8 323.9 -1.9 -0.58%
MAR '22 SOY MEAL $ / TON 326.5 324.2 324.5 -1.7 -0.52%
MAY '22 SOY MEAL $ / TON 329.4 327.5 327.6 -1.8 -0.55%
JUL '22 SOY MEAL $ / TON 333 331.2 331.2 -1.9 -0.57%
DEC '21 Chicago SRW $ / BSH  7.6425 7.5225 7.53 -0.065 -0.86%
MAR '22 Chicago SRW $ / BSH  7.7625 7.645 7.655 -0.0625 -0.81%
MAY '22 Chicago SRW $ / BSH  7.785 7.6775 7.6825 -0.0625 -0.81%
JUL '22 Chicago SRW $ / BSH  7.665 7.57 7.5725 -0.06 -0.79%
SEP '22 Chicago SRW $ / BSH  7.67 7.585 7.5925 -0.05 -0.65%
DEC '21 Kansas City HRW $ / BSH  7.8175 7.7025 7.7075 -0.07 -0.90%
MAR '22 Kansas City HRW $ / BSH  7.8375 7.73 7.7325 -0.0725 -0.93%
MAY '22 Kansas City HRW $ / BSH  7.8175 7.73 7.73 -0.065 -0.83%
JUL '22 Kansas City HRW $ / BSH  7.6725 7.5975 7.5975 -0.06 -0.78%
SEP '22 Kansas City HRW $ / BSH  7.6575 7.6575 7.6575 0.005 0.07%
DEC '21 MLPS Spring Wheat $ / BSH  10.2975 10.2 10.2175 -0.0525 -0.51%
MAR '22 MLPS Spring Wheat $ / BSH  10.0475 9.97 9.9875 -0.0425 -0.42%
MAY '22 MLPS Spring Wheat $ / BSH  9.76 9.715 9.715 -0.0425 -0.44%
JUL '22 MLPS Spring Wheat $ / BSH  9.46 9.39 9.39 -0.0375 -0.40%
SEP '22 MLPS Spring Wheat $ / BSH  8.45 8.44 8.45 0.0075 0.09%
DEC '21 ICE Dollar Index $ 93.95 93.685 93.72 -0.089 -0.09%
 DE '21 Light Crude $ / BBL  84.12 82.97 84 0.24 0.29%
 JA '21 Light Crude $ / BBL  83 81.97 82.93 0.32 0.39%
NOV '21 ULS Diesel $ /U GAL 2.5711 2.5472 2.5708 0.0061 0.24%
DEC '21 ULS Diesel $ /U GAL 2.5643 2.5389 2.5627 0.0055 0.22%
NOV '21 Gasoline $ /U GAL 2.531 2.5126 2.5295 0.0133 0.53%
DEC '21 Gasoline $ /U GAL 2.4576 2.438 2.456 0.0133 0.54%
OCT '21 Feeder Cattle $ / CWT 0 #N/A 155.625 0 0.00%
NOV '21 Feeder Cattle $ / CWT 0 #N/A 158.475 0 0.00%
 OC '21 Live Cattle $ / CWT 0 #N/A 125.025 0 0.00%
 DE '21 Live Cattle $ / CWT 0 #N/A 129.525 0 0.00%
DEC '21 Live Hogs $ / CWT 0 #N/A 74.2 0 0.00%
FEB '22 Live Hogs $ / CWT 0 #N/A 76.775 0 0.00%
OCT '21 Class III Milk $ / CWT 17.86 #N/A 17.86 0 0.00%
NOV '21 Class III Milk $ / CWT 19.37 19.19 19.26 -0.11 -0.57%
DEC '21 Class III Milk $ / CWT 19.04 19.03 19.03 -0.11 -0.57%

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