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Afternoon Market Recap for Dec. 14, 2018

: Slumping soybeans crave more China sales.

Soybean and wheat futures drop moderately on Friday, as corn hangs on for small gains

The good news: China is buying U.S. soybeans again – including two large sales announced Thursday and Friday. The not-so-good news: grain markets are hungry for much more, sending soybean futures to another round of moderate losses today. Embattled wheat futures also dropped again, while corn futures turned out fractional gains on some light technical buying.

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Concerns about a global economic slowdown weighed heavily on Wall St. Friday, with the Dow dropping 469 points in afternoon trading to 24,128, as the one-year return was trimmed to a meager 0.71%. Most energy futures were down 2% or more this afternoon, as crude oil sank back near $51 per barrel. The U.S. Dollar firmed moderately.

 

Corn prices ticked slightly higher Friday on some light technical selling spurred by export optimism, as December futures gained 1.25 cents to reach $3.7675, with March futures up a half-cent to $3.8475. 

Corn basis bids were mixed Friday, rising between 5 and 13 cents at multiple elevators but dropping as much as 9 cents lower across other Midwestern locations today.

Private exporters reported to USDA the sale of 4.9 million bushels of corn for delivery to Japan during the 2018/19 marketing year, which began September 1. Large grain sales have been reported four out of five days this week.

Russia’s 2018 corn harvest was for 393.7 million bushels, according to the country’s deputy agriculture minister.

China’s National Bureau of Statistics estimates the country produced 10.129 billion bushels of corn in 2018, slipping 0.65% below last year’s production.

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Preliminary volume estimates were for 168,731 contracts, down moderately from Thursday’s final count of 207,883.

 

Soybean prices dropped moderately Friday, even despite two large export sales reported this morning, as traders have been hoping for more dramatic sales to ramp up from China after promises made earlier this week. January futures fell 6.5 cents to $9.0050, with March futures down 6.75 cents to $9.1375.

Soybean basis bids were largely unchanged across Midwestern locations Friday but did drop 5 to 8 cents lower at several river terminals today.

Private exporters reported two large soybean sales to USDA today. The first was for 11.0 million bushels to China; the second was for 4.8 million bushels to unknown destinations. Both sales were for delivery during the 2018/19 marketing year, which began September 1.

Ahead of the next monthly National Oilseed Processors Association (NOPA) report, analysts expect the group to show a November soybean crush of 168.444 million bushels, slipping 2.3% below October’s all-time record of 172.346 million bushels. Even so, it would be the largest November crush and the third-largest monthly total on record.

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Preliminary volume estimates were for 167,373 contracts, dropping moderately below Thursday’s final tally of 230,246.

 

Wheat prices moved lower on some technical selling and profit-taking Friday. March Chicago SRW futures fell 6 cents to $5.30, March Kansas City HRW futures slipped 2 cents to $5.18, and March MGEX spring wheat futures dropped 4.25 cents to $5.8225. 

Russia’s 2018 wheat harvest reached 2.572 billion bushels, according to the country’s deputy agriculture minister. Russia also produced 762.4 million bushels of barley this year.

China’s National Bureau of Statistics reports the country’s 2018 wheat production reached 4.828 billion bushels, down 2.2% from last year’s total.

Egypt purchased 6.6 million bushels of wheat earlier this week – two-thirds of the total is sourced from Russia, with the remainder coming from Romania. The grain is for delivery in early February.

Jordan purchased 2.8 million bushels of animal feed barley from optional origins in an international tender that closed Thursday; the grain is for shipment in early April.

Preliminary volume estimates reached just 49,355 CBOT contracts today, coming in at less than half of Thursday’s final count of 111,727.

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