Mostly Lower With Bean Oil The Outlier

MORNING AG OUTLOOK

Mostly lower trade across the Ag space overnight with soybean oil the outlier to the upside.  Bean oil is drawing support from higher energy prices as tensions in the Middle East remain elevated after Saudi Arabia closed a key pipeline this past weekend.  So far Russia nor Ukraine has confirmed Pres. Trump’s claim yesterday that the 2 countries have agreed to halt attacks on each other energy infrastructure.  Spot WTI crude oil is up $.95 per barrel at $102.35 while RBOB is up $.03 per gallon with HO $.10 higher, all holding within yesterday’s range however.  Widespread rain across the NC Midwest the past 24 hours with heaviest amounts stretching from C. IA into NC WI.  Forecasts call for continued moderate to heavy rain across the NC Midwest, slowing crop maturation and early harvest operations.  Hot and dry across the S. Midwest and Delta region, helpful for harvest activities.  Week 2 of the outlook shows above normal temperatures across the nation’s midsection with normal to below normal precipitation.  In SA rains restricted to NE Argentina and the interior South of Brazil where temperatures hold below normal.  Warm and dry everywhere else.  Hot/dry in W. Europe with scattered showers in the east.  The US $$ is moderately higher while holding within yesterday’s range.  The odds of a Fed rate hike this week are just over 90%.  US stock indices are slightly lower.

Corn: 

Dec-26 futures are down $.05 ¼ at $5.28, holding within yesterday’s range.  Crop conditions improved by 1% to 55% G/E.  Composite ratings improved in 10 states, declined in 5 while holding steady in 2.  Overall ratings held at the crop cycle lows, just below the historical average.  86% of the crop is dented, 42% mature, both above YA and the 5-year Ave.  Harvest has reached 8% vs. 7% YA and 5-year Ave. of 6%.  My model incorporating updated acres, ear population data and ratings suggest an average US yield of 178.5 bpa with production at 15.797 bil. bu. almost exactly in line with the USDA forecast at 15.80 bil. bu.  Conab is expected to update their Brazilian production forecast this AM.  Last month they had 2025/26 production at 143 mmt, vs. the USDA forecast of 141 mmt.  Their 1^st crop 2026/27 plantings have reached 22% vs. 17% YA.  France’s farm ministry lowered their 2026 production forecast .9 mmt to 8.1 mmt, well below the 12 mmt from YA and the lowest in over 40 years.

Soybeans:  

Nov-26 beans are down $.08 at $12.96 ½ while holding within yesterday’s range.  Oct-26 meal is down $2 at $348.20 while Oct-26 oil is up 10 points at 69.75.  Crush margins have rebounded $.03 ½ to $2.55 bu.  Crop conditions held steady at 58% G/E.  Composite ratings held at crop cycle lows and are now just above the historical average.  Ratings improved in 8 states, declined in 8 while holding steady in 2.  44% of the crop is dropping leaves vs. the 5-year Ave. of 37%.  Harvest has reached 6%, vs. 5% YA and the 5-year Ave. of 3%.  Updated ratings, acres and pod count data would suggest an average US yield of 52.5 bpa with production at 4.512 bil. bu., just below the USDA forecast of 4.535 bil.  NOPA crush at 11 AM CST today is expected to show NOPA members processed 211.5 mil. bu. of soybeans in August.  While down from 216.65 mil. in July-26, its well above the 189.8 mil. in Aug-25.  The range of est. is 205-216.5 mil. bu.  Oil stocks are expected to slip to 1.257 bil. lbs. down from 1.36 bil. in July-25.  I’d estimate Chinese purchases at just over 13 mmt with less than 2 week’s until Chinese leader Xi is expected to visit Washington.  US Gulf FOB offers holding $.10-$.20 discount to Brazilian offers.

Wheat: 

Prices range from $.02 to $.12 lower with KC futures the leader to the downside.  CGO Dec-26 is $.09 lower at $7.13, KC Dec-26 is down $.12 at $7.80 ½, while Dec-26 MIAX is $.03 ½ lower at $7.33.  Improved prospects for rain in the drought-stricken S. Plains has caused an extraction of weather premium.  KC and MIAX futures have slipped to 3-week lows.  Spring harvest advanced to 93% complete, matching the YA pace while below the 5-year Ave. of 92%.  Winter wheat plantings at 8% are below the 10% pace from YA and the 5-year Ave. of 12%.  Stats Canada out tomorrow is expected to show wheat production at 38.3 mmt, down from 40 mmt YA while just above the USDA est. of 36 mmt.  SovEcon is forecasting Russia will export only 1.8 mmt in Sept-26, down from 2 mmt in Aug-26 and well below the 4.6 mmt shipped in Sept-25.

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