Wheat Futures Continue to Remain Range Bound

MORNING OUTLOOK

Grains are mixed.  SX is down 4 cents and near 14.52. SMZ is near 426.8 BOZ is near 65.99. CZ is up 4 cents and near 6.62. WZ is down 4 cents and near 8.08. KWZ is down 2 cents and near 8.91. MWZ is up 3 cents and near 9.23.

US stocks are higher US Dollar is lower Crude is higher. Gold, silver, copper and sugar are higher. Coffee, cocoa and cotton are lower.

Pro Farmer Midwest crop tour estimated IL corn yield at 191 vs 196 ly and soybean pod count down 3 pct from last year. They estimated NW IA corn yield at 181 vs 184 ly, WC IA 181 vs 201 and SW IA 174 vs 192 ly.

US Midwest should be mostly clear over the next few days. Much of the Midwest could see rains early next week. That should help soybeans. West EU remains dry. Russia is dry. Argentina is dry. China dry areas could see scattered rains.

Some feel 14.81 could be a top in the soybean market into harvest. Cash remains strong on good crush demand and lack of farmer selling. Yesterday CONAB est Brazil 2023 soybean crop near a record 150.3 mmt vs USDA 149.0 and 126 ly. Some feel key support could be closer to 13.00 SX. Interesting that USDA estimated US 2023/24 soybean cost of production will be near $554 per acres vs $567 ly. 2007 was near $275 with large increase since 2007 due to higher rent cost.

Corn futures continue to find support from strong cash basis. Feeders, crushers and exports are all looking to buy corn. Futures plus basis could be close to farmers increasing cash sales but farmer still feels prices before the end of the year could near 7.00. Ukraine exports and lower Brazil prices offer resistance. Some feel 6.70 CU may be too high going into harvest. Some feel key support could be closer to 6.00 CZ. Interesting that USDA estimated US 2023/24 corn cost of production will be near $793 per acres vs $813 ly. 2007 was near $450 with large increase since 2007 due to higher rent cost and fertilizer.

Wheat futures continue to remain range bound. Biggest bearish influence is lower Russian wheat export prices. Some estimate that spot Russia fob wheat export prices are down $50 per mmt from July. Still, Russia will need to increase export pace to reach USDA forecast of 42 mmt.

Some concern about 2023 weather could offer support. Some feel nearby Chicago wheat futures may be in a 7.50-8.40 range.

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