Neutral Nov. 9 numbers

By Doug Tenney, Leist Mercantile

Numbers highlights: corn exports unchanged, big surprise there. Corn for ethanol was unchanged. Soybean exports unchanged, soybeans for crush up 10 million bushels.

Following the noon report release, corn was down 2 cents, soybeans down 2 cents, and wheat  down 9 cents. Prior to the report, corn was down 5 cents, soybeans up 7 cents, and wheat down 11 cents. 

U.S. corn production was 13.930 billion bushels and a yield of 172.3 bushels per acres. Last month was 13.895 billion bushels for corn with a yield of 171.9. U.S. soybean production was 4.346 billion bushels with a yield of 50.2 bushels per acre. Last month was 4.313 billion bushels with a yield of 49.8 bushels. 

Trader estimates had U.S. corn production at 13.887 billion bushels and yield at 171.9 bushels. U.S. soybean trader production estimate was 4.315 billion bushels and yield at 49.8 bushels. 

U.S. 2022-2023 ending stocks: corn 1.182 billion bushels, last month 1.172 billion bushels; soybeans  220 million bushels, last month 200 million bushels; and wheat 571 million bushels, last month 576 million bushels. 

Trader estimates for 2022-2023 US ending stocks: corn 1.207 billion bushels; soybeans 212 million bushels; and wheat 578 million bushels. 

USDA today projected China would be importing 98 million tons of soybeans during the current marketing year from September to August. Last month was 98 million tons. China imported 4.4 million tons of soybeans in October, the lowest October number in 8 years. The low October import number implies the import pace needs to increase with an average of 8.5 million tons each are needed to reach USDA projections. 

U.S. corn exports have been disappointing the past month. Traders were expecting corn exports to be reduced, following the reduction trend seen in October of 125 million bushels, and a reduction of 100 million bushels in September. Soybean exports were reduced 40 million bushels in October and 70 million bushels in September.

Tuesday the U.S. sold 415,000 tons of soybeans to China, Mexico, and unknown destinations. On Monday, the U.S. weekly export inspections were: corn 9.1 million bushels; soybeans 95.2 million bushels; with wheat 6.6 million bushels. Soybean exports were above trade expectations. Both corn and wheat exports were disappointing, below trade expectations. Weekly soybean exports the past two months have been exceptionally strong, often ranging from 90 to 107 million bushels. Presently, soybean exports comprise a huge percentage of the US weekly exports when you consider that from September to December the weekly export total of corn, soybeans, and wheat often reaches 100-125 million bushels. 

Over the weekend China reported the zero tolerance policy for COVID would remain until 70% of the Chinese population had received the Covid vaccination. That news was a negative for soybeans. Last week, there were rumors China was potentially relaxing their zero tolerance COVID policy. That rumor provided a spark for soybean prices as they rallied 62 cents last week. The zero tolerance policy has been locking down entire cities with movement outside the home severely limited. Exiting homes to buy food has been permitted while everyone in the household cannot exit their homes. 

On Thursday the US Consumer Price Index (CPI) for October will be released. It is expected to be near the same 8% level seen for much of 2022. Also, the US Fed (FOMC) will have another meeting on December 14 as part of the agenda includes an interest rate hike. Early projections suggest the December hike could be ½%. The last four interest rate hikes have each been ¾%. 

The NASS Monday weekly crop progress report had the U.S. corn harvest 87%, U.S. soybean harvest 94%. The Ohio corn harvest was 75% while the Ohio soybean harvest was 92%. Both the Ohio and U.S. harvest numbers for corn and soybean are ahead of their respective 5-year averages. 

Ohio’s producers are beginning to breathe a sigh of relief that the production year for corn and soybeans is winding down. However, they know much work remains in selling the balance of unsold 2022 corn and soybeans. Pricing of 2023 inputs looms large in coming weeks, especially when prices are lacking. That unknown continues to be a thorn all producers want to see removed.