Yesterday’s Strong Close Carried Into Overnight Session

MORNING AG OUTLOOK

Yesterday’s strong close across the Ag space carried over into the overnight session before turning mixed.  The soybean complex has led the recovery with Nov-26 soybeans recovering nearly all of last Friday’s losses.  The trade remains hopeful that US/China will drop reciprocal import tariffs at next week’s Trump/Xi summit in Washington.  Speculative traders were back in a buying mood yesterday while O.I. was down in feed grains and soybean oil, while higher in soybeans and meal.  Energy prices are steady to lower following recent sharp gains.  Spot WTI crude oil is down $2.15 per barrel at $103.70 while RBOB is down $.05 per gallon with HO $.03 lower.  Another round of heavy rain stretched from the C. Plains across the C. Midwest into the Great Lakes region over the past 24 hours.  Forecasts call for heavy rain across the N. Midwest and ECB over the next 7 days slowing crop maturation and harvest activities.  Hot and dry across the S. Midwest and Delta region, helpful for harvest progress.  In SA rains restricted to N. Argentina and the interior South of Brazil where temperatures hold at below normal readings.  Warm and dry elsewhere.  Hot/dry in W. Europe with scattered showers in the east.  The US $$ is slightly higher while holding within this week’s range.  The odds of a Fed rate hike at the conclusion of today’s FOMC meeting are over 90%.  US stock indices are higher.

Corn: 

Dec-26 futures are down $.01 ¾ at $5.34.  Corn bulls remain hopeful the Trump/Xi meeting this month will result in China’s purchase of US corn.  Today’s EIA report is expected to show ethanol production last week slipped a bit from 323 mil. gallons produced the previous week.  Yesterday Conab raised their 2025/26 corn production forecast for Brazil 1.1 mmt to 144, above the USDA forecast of 141 mmt.  They estimate production in 26/27 will rise to 148 mmt, well above the USDA est. of 139 mmt.  New crop plantings have reached 22% vs. 17% YA.  Friday’s COF report is expected to show feedlots held 11.279 mil. head of cattle as of Sept. 1^st, up 1.8% from YA.  Placements in Aug-26 are expected to be down 3.2% from YA while marketings off 3.9%.

Soybeans: 

Nov-26 beans are up $.08 ¼ at $13.27 with the overnight high within 3 cents of its contract high of $13.35 ¼.  Oct-26 meal is up $1.10 at $361.20 while Oct-26 oil is up 45 points at 70.33.  Crush margins climbed another $.06 to $2.57 ½ bu.  Yesterday Conab forecast Brazil’s 2026/27 soybean acres would grow only .7%, the lowest growth in 20 years, to 49.3 mil. HA, with production at 181.6 mmt, well below the USDA est. of 186 mmt.  Despite no flash sale announcements yet this week, I’d estimate Chinese purchases at just over 13 mmt.  US Gulf FOB offers holding $.10-$.20 discount to Brazilian offers.  NOPA crush in Aug-26 at 205.5 mil. bu. was below 216.7 mil. in July-26 and below expectations however, still a record high for the month.  Implied census crush at 211 mil. bu. would bring 25/26 crush total to 2.647 mil. bu., 8 mil. shy of the USDA forecast of 2.655 bil.  The daily crush rate fell to the lowest in 12 months at 6.81 mbd.  Oil stocks slipped to 1.201 bil. lbs. down 11.7% from July and the lowest since Nov-24.  Stats Canada, due out at 7:30 CST AM, is expected to report canola production at 21.65 mmt, down from 22.23 YA.

Wheat: 

Prices range from $.02 lower to $.02 higher in 2-sided trade overnight.  CGO Dec-26 is down $.01 ½ at $7.27, KC Dec-26 is $.01 lower at $7.95, while Dec-26 MIAX is $.02 higher at $7.50 ½. Stats Canada 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 reports “the prolonged disruption (of feed grains from the Black Sea) is being substantially underpriced, with no clear path to normal shipping.”  They forecast July thru Sept wheat shipments from Ukraine/Russia combined will only reach 8 mmt, vs. 16.2 mmt YA and the 5-year Ave. of 18.2 mmt.  Ukraine’s WW seedings have reached only 3.3%.  So far 171.6k HA of winter grain has been seeded, down 35% from YA.  Russian lowered their wheat export duty 2% to 1,146 rubles/mt for the period of Sept. 16-22^nd.

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