Special Market Update
Grain Market Commentary
Monday, October 9, 2017
By Mark Rossol, Commodity Merchant, The Andersons
Rains over the weekend give the US harvest a quick break before getting underway later this week. Bean moistures have been very low so far and the rain might actually be welcome to add some moisture into the unharvested beans. The rain is also having the added benefit of helping out SRW seeding in the eastern Midwest.
Yields so far are surprising across the board given the dry growing season. Not enough corn has been harvested yet but so far most analysts don’t think the USDA will have much justification to take yields lower on October 12 and might actually take them up slightly. Also, to be noted is many analysts still believe soy planted acres to come up by as much as 1 million acres. Couple that with a higher yield and the report could potentially be bearish.
China was on holiday last week and while demand has been strong it is not enough to firm the gulf barge basis. Today CIF beans for October trade in the low 30s after barge freight came tumbling down last week as rains eased fears of low water levels on parts of the river. Brazil looks to remain dry for the next couple of weeks and the trade will begin to look more earnestly for rains to start showing up in the forecast. If the rains don’t materialize, concerns will grow over the Brazilian crops.
Corn futures continue to languish and wheat has given back ground to corn over the last couple of weeks. Beans rallied the last 4 days but seem to be stalling out today on no new bullish inputs. Keep an eye out for the USDA report out on Thursday, October 12.