Grain Farmers of Ontario says there are concerns in the trade that U-S corn supplies may not be as large as originally expected.
This week's GFO market commentary says those concerns, combined with variable harvest results so far to create some gains for corn futures this week.
Soybean futures fell earlier in the week between some profit-taking and harvest pressure.
GFO's Todd Austin says a recent report indicating weather concerns in Australia and Russia have given some strength back to that market.
Austin says those same reports are also giving some strength to wheat futures.
He suggests possible frost damage in Australia could limit wheat production and increase demand from countries with adequate stocks - such as the U-S and Canada.
===
Grain Farmers of Ontario Weekly Market Commentary:
CORN Corn futures made gains this week on concerns that U.S. supplies may not be as large as originally expected. Harvest is showing variable production results so far. Harvest reports indicated that as of September 21, ten percent of the corn harvest was complete, just shy of the 5-year average of 15%. According to the U.S. Department of Agriculture, the corn crop remained unchanged at 68% good to excellent this past week. The crop condition has remained relatively strong despite issues with weather this year, though it is too early yet to get a clear yield picture. AS harvest progresses we will get a much better idea of overall yields and production levels.
SOYBEANS China’s imports of soybeans look to be on a slower pace than last year, resulting from a slowdown in animal feed demand coupled with the depreciation of China’s currency. The stock market meltdown this summer may be a sign of other economic issues within China. Since China buys more than 60% of globally traded soybeans, any reduction in imports will affect all exporters. Soybean harvest in the U.S. was at seven percent as of September 21, with a crop rated at 63 per cent good to excellent, up from 61 per cent a week ago. Between some profit taking and harvest pressure, soybean futures have been falling earlier this week, though a recent report indicating weather concerns in Australia and Russia have given some strength back to the market.
WHEAT September's USDA report indicated U.S. wheat carry out to be 875 million bushels. With a large global surplus and a strengthening U.S. dollar, exports are weakening as U.S. wheat is more expensive for overseas buyers. Wheat futures strengthened on news that unfavourable weather in the Australia and Black Sea area would hamper their respective wheat crops. Possible frost damage in Australia could limit wheat production and therefore global supplies while increasing demand from countries with adequate stocks, such as the U.S. or Canada.
Todd Austin - Grain Farmers of Ontario
