New- and old-crop soybean contracts diverge

Fresh exports of U.S. soybeans and corn announced Thursday.

On Thursday, the CME Group’s farm markets close mixed.

At the close, the Sept. corn futures finished 1½¢ higher at $5.52. New-crop Dec. futures finished 1¢ lower at $5.50. March corn futures settled 1½¢ lower at $5.57.

Sept. soybean futures finished 21½¢ higher at $13.67.

Nov. soybean futures closed 6½¢ lower at $13.26. January soybean futures closed 7¢ lower at $13.30¾.

Sept. wheat futures closed 13¾¢ higher at $7.39½.

Dec. soymeal futures closed $3.10 per short ton higher at $355.90.

Dec. soy oil futures settled 1.21¢ lower at 60.03¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.02 lower (-1.49%) at $67.34. The U.S. dollar is higher, and the Dow Jones Industrials are 133 points lower (-0.38%) at 35,271 points.

On Thursday, private exporters reported to the USDA the follow activity:

• Export sales of 100,000 metric tons of corn for delivery to Colombia during the 2021/2022 marketing year.
• Export sales of 133,000 metric tons of soybeans for delivery to China during the 2021/2022 marketing year.
• Export sales of 132,150 metric tons of soybeans for delivery to unknown destinations during the 2021/2022 marketing year.
• The marketing year for corn and soybeans began Sept. 1.

Jason Roose, U.S. Commodities, says that the market participants see the weather as price-negative.

“Corn and soybeans are taking premium out of the market today, as the weather leans negative with late rains. Export sales were as expected with continued spot soybean purchases from China. The strong U.S. dollar and weak energy markets are bearish short term with grain harvest fast approaching,” Roose says.

Bob Linneman, Kluis Advisors, says that farmers should keep an eye on next year’s prices.

“One thing we should be watching closely is the 2022 new-crop prices. If traders start to feel that demand won’t hit USDA targets for next year, then the current 2022 new-crop prices ($5.19 and $12.70) are not likely to stick around for very long,” Linneman stated in a note to customers.

Linneman added, “The rally this week has helped ease the momentum indicators away from oversold levels. Although a late-August rally in prices is nice to see, it is hard to expect the bulls to mount a full reversal higher on the charts this time of year. We need to be concerned about demand holding pace.”

Separately, the USDA’s Weekly Export Sales Report Thursday shows decent demand figures for corn.

Corn = 690,600 metric tons (mt.) vs. the trade’s expectation of 250,000 to 900,000 mmt.

Soybeans = 1.82 mmt. vs. the trade’s expectation of 125,000 to 2.0 mmt.

Wheat = 116,000 mt. vs. the trade’s expectation of 250,000 to 700,000 mt.

Soybean meal = 201,200 mt. vs. the trade’s expectation of 50,000 to 200,000 mt.

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Tags: contracts, soybean