Modest gains were the order of early deals in ag markets.
This time, however, it was wheat and corn which
outperformed soybeans, arguably against
the run of commentator talk on which contract has the most supportive
On points, soybean futures are seen as having the most
bullish (lest bearish) prospects for both demand and supply reasons, the former
including an easing off in upbeat talk on US harvest yields.
"Twittersphere continues to talk about US soybean yields
drifting lower as harvest moves to later-planted beans," said Benson Quinn Commodities.
At Futures International, Terry Reilly said that "the
combination of cold temperatures and precipitation is not favourable for late
crop maturation and harvesting".
While analysts are lifting soybean estimates, ahead of the
US Department of Agriculture's Wasde crop report next week, the fresh forecast
are not as large, relative to the official one, as for corn.
On Thursday, for instance, Informa Economics raised its
soybean yield estimate by 0.6 bushels per acre from last month to 50.0 bushels
per acre, taking it just 0.1 bushels per acre ahead of the USDA estimate.
Lanworth raised its estimate by 0.5 bushels per acre to 49.3
bushels per acre, below the USDA forecast.
However, on corn, both were ahead of the USDA's 169.9
bushels-per-acre figure, with Informa coming in at 170.5 bushels per acre and
Lanworth at 171.3 bushels per acre.
'Beans have a friend'
Then there are the Brazilian dryness worries, which remain
live, in cutting prospects for a successful sowing season.
"Weather forecasters expect dry soybean regions in Mato
Grosso, Brazil to remain that way for another week or so," said Tobin Gorey at
Commonwealth Bank of Australia, terming it issue "supportive" for prices, if
not one worth of sparking a rally "for now".
And there are the demand ideas to factor in, in which soybeans
are also outperforming corn and wheat, in terms of US export sales.
"The market needs to attract more corn and wheat business. Beans
have a friend in China," said Benson Quinn Commodities.
CBA's Mr Gorey said that for wheat, "US export sales
continue to be so so".
CHS Hedging, meanwhile noted that "soybean basis has been
seen firming at US Midwest river terminals as barge freight continues to slip
lower", after the rally spurred by lower river levels which put a squeeze on
"Rainfall and greater availability of empty vessels has
helped ease the flow of river traffic.
"Soybean bids were seen gaining as much as $0.14 per bushel
on the Mississippi River system."
All in all, "demand and Brazilian weather are keeping a
floor of support under the bean markets", said Benson Quinn Commodities.
However, Chicago soybean futures for November added just
0.1% to $9.69 a bushel as of 09:40 UK time (03:40 Chicago time), compared with a
0.2% gain to $3.50 ¼ a bushel in corn for December.
Chicago wheat futures for December added 0.4% to $4.42 ¼ a
Whether this was down to pre-weekend profit-taking on some grains
vs oilseeds bets…
"The funds have a growing short corn and wheat, long beans
spread working," Benson Quinn Commodities said.
It was also helpful for Chicago wheat futures that prices in
Sydney overnight pulled out of their decline, rising by 0.8% to Aus$280.00 a
tonne for January delivery, back just ahead of their 20-day moving average.
That left them flat for the week, albeit down 5% from a
late-September high, before rains eased eastern Australian crop dryness fears somewhat.
In fact, Sydney futures retain a hefty weather premium, with
CBA's Tobin Gorey saying that they "remain well above export levels, so they
will need to fall more than Aus$50 a tonne to be competitive even to
destinations nearest Australia", although on the ground, the premium does vary
'Frost and possible
Weather is in focus in the US too, in part in temperatures
"It will get very cold next week across the northern Plains
and a big part of the upper Midwest," Futures International's Terry Reilly
"Frost and possible freezes could occur," although he added
that "no damage to the immature late crop is expected".
However, rains are a factor too, both short-term, with some Midwest
areas seeing late-week rains, while Hurricane Nate is expected to bring
downpours to some eastern areas in particular early next week.
While a setback for fieldwork, including row crop
harvesting, moisture is needed in soft red winter wheat growing areas of the
Midwest in particular.
Of course, Hurricane Nate is also being especially closely
watched in the cotton market, given
that the US cotton belt is sited along the south and east coastal strip, and so
tends to take the brunt of such storms – as it has already done with Harvey and
Still, "model projections of rainfall from the storm are now
much less worrisome" for cotton growers, Mr Gorey said.
The latest National Hurricane Center projection has cut the severity
of Nate, and taken its path further west, deemed less threatening for US cotton
Nate is seen "sparing at least for now the second largest
cotton growing state of Georgia and a crop that is open and vulnerable", said
Ron Lee at McCleskey Cotton.
The current projected itinerary, up through Louisiana,Mississippi
and Albama "would likely spare the US cotton crop from much damage as there
just isn't a whole lot of cotton in the eye of the current path," Mr Lee said.
"The northern Alabama crop is still largely unopened and
would not be too adversely affected."
New York cotton for December traded all of 0.01 cents higher
at 68.289 cents a pound.