By Kirk Maltais
--Soybeans for January delivery fell 1.1% to $9.98 1/2 a bushel on the Chicago Board of Trade on Tuesday, trading under pressure as Brazilian rainfall continues to support crop growth there.
--Corn for December delivery fell 0.5% to $4.27 1/4 a bushel.
--Wheat for December delivery rose 0.5% to $5.49 3/4 a bushel.
HIGHLIGHTS
Smooth Operations: Weather in Brazil continues to support the healthy early development of the country's crop, putting more pressure on the competitiveness of U.S. exports. "The soybean export demand has been decent, but given the fact that South American crop is developing with few problems and with a positive weather forecast into the month of December, export demand is going to quickly shift to South America," said Tomm Pfitzenmaier of Summit Commodity Brokerage in a note.
Other Influences: Most-active CBOT soybean futures fell back below the $10/a bushel mark Tuesday, with traders pricing in weakness from strong production in both the U.S. and Brazil. Absent other market-moving news, soybean futures may be subject to downward momentum near-term, says Virginia McGathey of McGathey Commodities. "Soybeans popped up because Palm Oil popped up--however, beans will have a very tough time going into the end of the year," she said.
Military Incursion: CBOT wheat was propelled higher throughout the day after Ukraine fired long-range missiles provided by the U.S. into Russia for the first time, hitting an ammunition storage facility in Russia's Bryansk region. The developments seem to have offset data from the USDA's Crop Progress report showing U.S. winter wheat conditions improving by five percentage points from the previous week, to 49% good or excellent condition. This is the best that winter wheat has looked in the past three years, said AgResource in a note.
INSIGHT
Expecting Hostility: Traders spent a lot of today's session readying themselves for an uncertain environment heading into 2025. "Corn and soybeans continue to hold psychological discounts due to future trade concerns," said Rich Nelson of Allendale Inc. in a note. Little clarity yet exists on Trump trade policy, with Trump pressing forward making his cabinet picks.
Demand Question: Weaker global demand for commodities is expected to put pressure on prices, TD Securities said in a note. With 'pandemic-era supply shortages' easing, weaker demand from major consumers like China are leaving supplies of things like agriculture and base metals widely available. What could add to this is if President-elect Donald Trump enacts his tariff plans, which are expected to bring higher inflation and lower global economic growth with them. "The U.S. is only half of the puzzle," said Richard Kelly of TD Securities in the note. "Policy risk works both ways."
Record Breaking: The average daily production of ethanol in the U.S. could keep climbing past the record level it set last week, according to analysts surveyed by Dow Jones. Analysts said that daily production may rise to as high as 1.12 million barrels a day in Wednesday's report from the EIA. That would be up from last week's record-high level of 1.113 million barrels a day. In its earnings report Monday, Archer Daniels Midland said the company expects 'strong fundamentals in ethanol' through the rest of the year.
AHEAD
--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.
--The USDA will release its monthly livestock slaughter report at 3 p.m. ET Thursday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
11-19-24 1526ET
