Written Commentary
SOYBEANS
Soybeans ended the week lower. Soybean futures have been on the defensive due to ongoing US harvest and lack of new US soybean export sales to China. Bearish USDA Sep 1 stocks report triggered long liquidation. Lower prices could slow new farmer selling, increase end user buying and could force US farmers to plant less US 2022 soybean acres versus corn and wheat. Trade now looks at US 2021 soybean crop near USDA 4,374 mil bu. Carryin is 256. Crush is est near 2,200 vs USDA 2,180 and 2,140 last year. Exports 2,050 vs USDA 2,090 and 2,260 ly. This suggest a carryout now near 265 vs USDA 185. Demand especially to China will need to increase to offset the higher US supply. 2022 weather now key with La Nina suggesting dry weather for parts of Brazil and Argentina and dry start to US 2022 crop season.
CORN
Corn futures ended higher. Recent rally in energy prices and talk US corn harvest yields could be lower than expected offered support. This despite the fact USDA found higher US Sep 1 stocks than expected. Matif corn futures continue to move higher due to wet weather delaying W EU corn harvest. Ukraine yields are coming in below expectations. Brazil and Argentina weather is dry. Trade now looks at US 2021 corn crop near 14,700 mil bu vs USDA 14,996. Carryin is 1,236. Feed is est near 5,625 vs USDA 5,700 and 5,725 last year. Exports 2,650 vs USDA 2,475 and 2,745 ly. This suggest a carryout now near 1,200 vs USDA 1,408. CZ had an inside day and closed above Thursdays high. This week, CZ held above 5.25 support. CZ is near 5.40 moving average level. 100 day moving average resistance is near 5.49. US farmer remains a reluctant seller of cash above previous contract sales. Some feel farmers could increase sales above 5.60 CZ. US domestic cash basis continues to firm on favorable ethanol margins and prospects for improved US export shipments.
WHEAT
Wheat futures ended sharply higher. Fact USDA estimated US 2021 crop lower than expected especially winter wheat and estimated US Sep 1 stocks lower than expected helped rally futures. Managed funds increase net longs. Along with the bullish USDA numbers, there is also talk of lower Russia exports and more countries might ban imports of GMO Argentina wheat. Brazil was first and now Morocco. Some feel low US/World wheat free supplies may also be forcing wheat prices higher to increase 2022 wheat acres. Talk that La Nina could dry US south plains in 2022. USDA est US 2021 wheat crop at 1,645 mil bu vs 1,697 previous. Food is est at 964 vs 961 ly. Exports 885 vs 992 ly. This suggest a carryout now near 510 vs USDA 615. WZ is near 7.51. KWZ is near 7.55. MWZ is near 9.28.
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