By Kirk Maltais
-- Wheat for December delivery fell 2.1% to $5.86 1/2 a bushel on the Chicago Board of Trade on Monday, with Russia's efforts to enforce a price minimum amid questions about crop production questioned by grain traders.
-- Corn for December delivery fell 1.9% to $4.07 3/4 a bushel.
-- Soybeans for November delivery fell 0.9% to $9.96 a bushel.
HIGHLIGHTS
Beast of the East: The current status of Russia's wheat growing and exporting programs were the main factors moving CBOT wheat futures.
The Russian Ministry of Agriculture set a price floor of $250 per metric ton of wheat out of Russia, but analysts speculated Monday that Russia is still offering wheat sales below that supposed floor.
Additionally, rainfall in both the Black Sea and the U.S. is expected to pick up, providing strength for freshly planted winter wheat crops.
"Plus the global wheat WASDE data perhaps a little more bearish than had been expected," said Joel Karlin of Ocean State Research.
Not So Hungry: China's slower pace of export growth in September, with outbound shipments up 2.4% from a year earlier and imports rising 0.3%, pressured commodities across the board.
"Import volume fell sequentially for most commodities except for natural gas," said Goldman Sachs in a research note.
A slowed-down Chinese economy is expected to stifle demand for raw commodities for the country's manufacturing sector, which is in turn impacting the outlook for export demand in other countries like the U.S. for goods such as grains and petroleum.
Picking Up From Friday: Trader reaction to Friday's WASDE report continued to be felt Monday. The report showed little impact from hot weather in September and maintained a view of record-high crops, with the USDA even lifting its outlook for corn yields higher.
Weather over the weekend reinforced the USDA's stance, said Tomm Pfitzenmaier of Summit Commodity Brokerage in a note. "It was nearly a perfect harvest weekend, so there may be some harvest pressure on prices as well."
INSIGHT
Reducing Position: The CFTC's Commitments of Traders Report released Friday showed that fund traders cut their short positions in corn by nearly 44,000 contracts, the largest move seen in grains among fund traders for the week ended Oct. 8.
Fund traders favored net long positions in soybeans for the week, with over 13,000 long contracts added and shrinking the net short among fund traders to nearly 22,000 contracts.
"The buying in corn and beans was much greater than expected with the net short in both markets much smaller than expected," said Doug Bergman of RCM Alternatives in a note.
Thinner Coffers: University of Missouri researchers forecast that the state's farmers will suffer a 16% drop in total income from the previous year, falling to $3.66 billion in 2024.
This drop exceeds the national average, which is closer to 6%, the university said, attributing the sharper decline to the decrease in crop receipts by over $1 billion, with crop receipts making up a larger portion of Missouri farm income than in other states.
The 2024 downturn is expected to continue into 2025, said Alejandro Plastina, an associate professor with Mizzou's College of Agriculture, Food and Natural Resources.
Stubborn Situation: CBOT wheat was down, but traders still think the grain is the most exposed to global supply issues coming from weather issues seen in Russia, Australia and France, which should make U.S. wheat a more-desired product.
But traders aren't adding risk premium in the event of a constrained supply, even as uncertainty continues around the status of Russian wheat exports to start this week.
AHEAD
-- The USDA is scheduled to release its weekly grains export inspections report at 11 a.m. EDT Tuesday.
-- The USDA is due to release its weekly crop progress report at 4 p.m. EDT Tuesday.
-- The EIA is scheduled to release its weekly ethanol production and stocks report at 10:30 a.m. EDT Thursday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
10-14-24 1537ET
