Headlines:
- THE USDA QUARTERLY GRAINS STOCKS SUMMARY WILL BE RELEASED ON FRIDAY SEPTEMBER 30TH AT 12PM EST.
- PM MARKETS: GRAIN FUTURES FALL BACK, AS US TURNS DRIER
CORN FUTURES TUMBLED, AS US WEATHER FORECASTS SUGGESTED THAT THE US MIDWEST WILL TURN DRIER, ALLOWING THE HARVEST TO PICK UP PACE. THE HARVEST GOT OFF TO A SLOW START THIS YEAR, DUE TO WET WEATHER, AND THERE WERE FEARS THAT IF THE WET WEATHER PERSISTS DISEASE PROBLEMS COULD DEVELOP. US HARVEST PROGRESS DUE TO BE RELEASED THIS AFTERNOON TO SHOW THE HARVEST ABOUT 15% COMPLETE, COMPARED TO AN AVERAGE OF 25% AT THIS TIME OF YEAR. - RUSSIAN WHEAT SOWINGS THREATENED BY DRY WEATHER
The hot dry summer in the Black Sea region is stirring concerns for next winter wheat crop, as the European Commission warns on Russian prospects after a hot dry summer. While US wheat sowings are expected to fall sharply this year, in response to low prices, sowings in Russia are expected to boom, thanks to the weak Ruble which is supporting export demand. But the low soil moisture levels are beginning to throw doubt on those assumptions, with Ukrainian prospects also questioned.
Summary:
Drier weather in the forecast for this week looks to facilitate producers’ ability to take combines into the fields so that they can continue harvesting their crops. Some parts of the Midwest received rain over the weekend but that was not enough to hold back the selloff in grains that was posted today. December and March Corn dropped 7.75 cents each, November and Jan Beans lost 8 & 8.25 cents respectively, and December Wheat surrendered 8.75 cents. Today’s decline appears to be indicative of the strength of the harvest reported by farmers after they have had the opportunity to get into the fields.
Both Corn and Beans harvest progress is right in line with the average pace for this time of the year and Managed Money increased their short side stake in Corn futures according to Friday’s report. Their bets on Beans were not quite as bearish with Speculators increasing their net long position there. US Soybean export inspections were almost half that of the previous week. With the harvest ramping up and a poor export inspection report, Speculators might find themselves on the wrong end of the move over the next few weeks. Managed Money has deep enough pockets to perhaps weather the storm. It may be their plan to simply bear the drawdown.
As would be expected the weakness in Beans in Corn today was a drag on Wheat and it may not find a low of significance until mid to late October.
