Soybean Market Leads the Way Friday

DES MOINES, Iowa -- On Friday, the CME Group's farm market watched the soybean price move up as much as 6¢ per bushel, only to fall back.

At the close, the Dec. corn futures settled 4¼¢ lower at $3.71¾. March corn futures settled 4¢ lower at $3.80.

Jan. soybean futures finished 1¾¢ higher at $9.18½. March soybean futures closed 2¢ higher at $9.31½.

Dec. wheat futures ended 5¢ lower at $5.02¾.

December soymeal futures closed $4.00 per short ton higher at $307.00. December soy oil futures settled 0.35¢ lower at 30.43¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.96 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 157 points higher.

Al Kluis, Kluis Advisors, says the markets are having a tough time finding traction.

"We got some positive news out of Congress that the House could be ready to approve the U.S./Mexico/Canada agreement. This would be some good news for U.S. farmers and overall demand," Kluis told customers in a daily note.

Separately, the USDA's Weekly Export Sales Report Thursday shows strong soybean figures.

Corn: 81,600 metric tons (mt) vs. the trade's expectations of between 400,000 and 800,000 mt

Soybeans: 1.253 mmt vs. the trade's expectations of 800,000 and 1.4 mmt

Wheat: 238,600 mt vs. the trade's expectations of between 250,000 and 500,000 mt

Soybean meal: 345,800 mt vs. the trade's expectations of 100,000 and 350,000 mt

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Thursday's Grain Market Review

On Thursday, the CME Group's farm markets close mostly higher.

At the close, December corn futures finished ½¢ higher at $3.75¾; March corn futures ended ¾¢ higher at $3.84¾.

January soybean futures closed 1½¢ higher at $9.16½; March soybean futures closed 1¢ higher at $9.29½.

December wheat futures finished 1¼¢ lower at $5.07¾.

December soy meal futures settled $1 per short ton lower at $303.10. December soy oil futures ended 0.25¢ higher at 30.78¢ per pound.

In the outside markets, the NYMEX crude oil market is 30¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 4 points lower.

On Thursday, private exporters reported to the USDA export sales of 129,000 metric tons of soybeans for delivery to China during the 2019/2020 marketing year.

The marketing year for soybeans began September 1.

Al Kluis, Kluis Advisors, says the markets are having a tough time finding traction.

"Trade talks between the U.S. and China seem to be hitting another snag, and the impeachment hearings have the market wanting to drift lower," Kluis told customers in a daily note.

Kluis added, "Keep a close eye on basis levels in your area. We are seeing a lot of activity, from firmer basis levels in Illinois to wider basis in Nebraska. Once the basis starts to widen out, it could get ugly quick."

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Wednesday's Grain Market Review

On Wednesday, the CME Group's farm markets attempt to turn higher, close weaker.

At the close, December corn futures finished 2½¢ lower at $3.75¾; March corn futures ended 2¾¢ lower at $3.84¾.

January soybean futures ended 1¾¢ lower at $9.15; March soybean futures settled 1¼¢ higher at $9.28½.

December wheat futures settled 8¢ lower at $5.09.

December soy meal futures closed $1.80 per short ton higher at $304.10. December soy oil futures settled 0.50¢ lower at 30.53¢ per pound.

In the outside markets, the NYMEX crude oil market is 34¢ per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 29 points higher.

On Wednesday, private exporters reported to the USDA export sales of 106,000 metric tons of soybeans for delivery to unknown destinations during the 2019/2020 marketing year.

The marketing year for soybeans began September 1.

Darin D. Fessler, Lakefront Futures & Options LLC, says investors are looking for more news to trade.

"The market is lacking bullish headlines, with the USDA not showing its cards much on Friday's report. The spreads continue to firm, and basis levels continue to be getting strong. I think that's telling a lot of the story regardless of what the USDA and outright futures are doing here," Fessler says.

Al Kluis, Kluis Advisors, says wheat may hold the key to a rally.

"The rally in wheat on Tuesday could be the spark that the grain bulls were needing. The corn and soybean charts are oversold and have gotten close to strong levels of support," Kluis told customers in a daily note.

Kluis added, "The strength in wheat can be largely attributed to the much-better-than-expected weekly export inspection report. The Crop Progress Report pegged the U.S. corn harvest at 66% complete. This compares to 85% for the five-year average. Soybean harvest was reported at 85% complete, which compares to the five-year average at 92%."

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Tuesday's Grain Market Review

On Tuesday, the CME Group's corn market finds strength.

At the close, December corn futures finished 4½¢ higher at $3.77¾; March corn futures closed 4½¢ higher at $3.86½.

January soybean futures closed unchanged at $9.17; March soybean futures closed ¼¢ lower at $9.30¼.

December wheat futures finished 11¼¢ higher at $5.17.

December soy meal futures closed $1.70 per short ton higher at $302.30. December soy oil futures closed 0.39¢ lower at 31.03¢ per pound.

In the outside markets, the NYMEX crude oil market is 1¢ per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 8 points higher.

Jack Scoville, PRICE Futures Group, says the market seems to be waiting for news to trade.

"Some buying is showing up in corn and this is worth keeping an eye on. We have held the $3.80-per-bushel price in the March futures contract since the Monday USDA report, now maybe the market is short enough. It could pop 10¢ to 15¢ just on fund buying and farmers are not selling. Basis is firm. Farmers are not selling beans either, and basis levels there are firm.

Scoville adds, "However, reports of good rains in parts of South America are keeping the pressure on, so speculators are on both sides, I think. Wheat is real strong, and I have not heard anything special, but some burn or winterkill is a possibility and maybe some demand from somewhere," Scoville says.

Al Kluis, Kluis Advisors, says outside markets may influence the ag commodities.

"The announcement by Trump that he would not agree to a partial rollback on tariffs with China prior to Phase 1 signing put pressure on the stock and commodity markets on Monday," Kluis told customers in a daily note.

Kluis added, "The timing was right for a low in the corn market on Monday. The last two lows each month have come in on September 9, 2019, and then on October 10, 2019. Maybe the corn market put in the low on November, 11, 2019?"

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Monday's Grain Market Review

On Monday, the CME Group's farm markets trade lower.

At the close, December corn futures finished 4¢ lower at $3.73¼; March corn futures finished 4½¢ lower at $3.82.

January soybean futures ended 14½¢ lower at $9.17; March soybean futures closed 13½¢ lower at $9.30½.

December wheat futures closed 4¼¢ lower at $5.05.

December soy meal futures settled $4.30 per short ton lower at $300.60. December soy oil futures settled 0.08¢ lower at 31.42¢ per pound.

In the outside markets, the NYMEX crude oil market is 36¢ per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 9 points higher.

Britt O'Connell, cash adviser for Commodity Risk Management Group, says the markets have a softer tone across the board today, after few changes were made to the balance sheets in the USDA's WASDE Report on Friday.

"The soybean market had obviously priced in a production reduction of some fashion. With no changes and a reduction to the crush demand, the soybean carryout estimate grew slightly. A softer tone on Phase 1 of a deal with China isn't helping today either," O'Connell says.

She added, "While the USDA did reduce corn yield, it also offset demand. Ethanol, feed usage, and exports were all trimmed and rightly so. Exports, in particular, are behind schedule for corn this year. Other than that, the news is light today. Trading volume was light early on as well," O'Connell says.

Al Kluis, Kluis Advisors, says investors are still digesting Friday's USDA data.

"On Friday, the grain markets closed mixed after the confusing USDA crop reports at 11 a.m. The reports showed a slightly smaller corn crop, a soybean crop that was virtually unchanged from October, and a slightly smaller wheat crop," Kluis told customers in a daily note.

Kluis added, "When the USDA's corn yield drops between October and November, it almost always is reduced again in the final USDA Crop Production Report in January."