By Kirk Maltais


--Soybeans for November delivery rose 5.2% to $14.85 3/4 a bushel on the Chicago Board of Trade Monday, in response to the USDA cutting its forecast for U.S. soybean yields more than expected by analysts.

--Corn for December delivery rose 1.4% to $6.94 1/4 a bushel.

--Wheat for December delivery fell 1.3% to $8.58 a bushel.


HIGHLIGHTS


Exceeding Expectations: The USDA's revision to U.S. soybean yields in its WASDE report was larger than expected by analysts, sending CBOT futures higher. The USDA pegged this year's soybean yield at 50.5 bushels per acre, which is down from 51.9 bushels per acre forecast in last month's report. Analysts surveyed by The Wall Street Journal had forecast yield to be at 51.5 bushels per acre. "Bullish bean data with acres and yield well below expectations," said Doug Bergman of RCM Alternatives in a note following the report's release.

Improved Prospects: Wheat futures on the CBOT stayed below water following the release of September's WASDE report, which showed lower-than-expected U.S. ending stocks but improved production prospects for both Russia and Ukraine. The USDA moved its outlook for Russian production up 3 million metric tons to 91 million tons, while Ukrainian production was marked up 1 million tons to 20.5 million tons. "Only minor shifts in the old-crop supply and demand with absolutely zero change in the domestic 22/23 tables," said Matt Zeller of StoneX in a note following the WASDE's release.

Outside Forces: Prior to the WASDE's release, soybeans found support from outside markets. "Soybeans are higher in part of a large drop in the USD and higher crude oil," said Terry Reilly of Futures International in a note. "Soybean meal and oil are higher for that reason as well." WTI crude oil futures rose 1.1% today, while the U.S. dollar index fell 0.6% - both indicators that provide support for soybean products, specifically soyoil.


INSIGHTS


Outsized Move: The climb in CBOT soybean futures following the release of the WASDE may be overstated in relation to the data, Rich Nelson of Allendale Inc. told the WSJ. "I will say this price reaction is a little more than 200 million new crop stocks would justify," Mr. Nelson said. The figure is less than expected by analysts surveyed by the WSJ last week, as is the 2022/23 soybean crop yield reported by the USDA. For corn, a tepid reaction in futures came as cuts to domestic demand offset the drop in yield.

Shifting Momentum: The back-and-forth over the continued viability of the deal allowing grain exports to leave from Ukrainian ports looks to be an ongoing source of volatility for grain futures. Anything threatening to end the deal is seen as pushing up prices, says Richard Buttenshaw of Marex in a note. "[The] world is going to need the wheat/corn out of the Black Sea and if there are military operations that bring that into doubt then the market is going to add premium," he said. Over the weekend, Ukraine mounted an offensive into Russian-occupied territory in the northeastern region of the country.


AHEAD


--The U.S. Bureau of Labor Statistics will release its monthly CPI report at 8:30 a.m. ET Tuesday.

--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.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

09-12-22 1519ET