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Soybeans Futures Higher on Export Hopes - Daily Grain Highlights

12/03/2021 | 04:01pm EST

By Kirk Maltais

--Soybeans for January delivery rose 1.9% to $12.67 1/4 a bushel on the Chicago Board of Trade on Friday, in reaction to indications of rising demand for U.S. exports.

--Corn for March delivery rose 1.3% to $5.84 a bushel.

--Wheat for March delivery fell 1.4% to $8.03 3/4 a bushel.


Foreign Appetite: China appears to be buying U.S. soybeans. The USDA confirmed a flash sale of 122,000 metric tons of soybeans for delivery to unknown destinations, which traders usually peg as China, the world's largest consumer of the oilseed. That comes after the agency confirmed on Thursday that 130,000 tons of soybeans were sold to China.

Quick Retreat: After jumping over the $8-a-bushel mark Thursday on indications that the U.S. export market would gain strength from Russian export taxes, wheat futures pulled back Friday. The reversal comes as the market further contemplates what the Omicron variant will mean for world demand. "The primary question at hand revolves around the health of the domestic and global economy going forward, and its perceived impact on the demand for commodities," said Arlan Suderman of StoneX.


Soybean Shuffle: The January contract snapped a five-day losing streak this week, turning higher on Thursday. This upside may be limited, AgriTel said. "From March onwards, competition from Brazil will be fierce, with production expected to reach a record high, except if end-of-cycle incidents occur," the firm said. One of those incidents could be weather. Some areas of Brazil are receiving less-than-normal rainfall, although many others are receiving normal amounts.

Risk Factor: Corn futures may be particularly susceptible to any change in the Fed's approach toward inflation because of the sizable long position held in corn by managed money funds, said Doug Bergman of RCM Alternatives. "The biggest risk is outside market influence as there is a historically large speculative long in the corn that may head for the sidelines if Fed policy shifts to a less inflationary approach," Mr. Bergman said. According to the CFTC, funds are net long in corn by nearly 367,000 contracts.

Flex: Brazil is about to commence harvesting a new crop of soybeans, but it still has plenty of old crop left to sell into the export market, Karl Setzer of AgriVisor said. "For the month of November, Brazil exported 2.6 million metric tons of soybeans, more than trade was expecting," he said. "Larger production has allowed for these sales to continue. Given the forecast for this year's crop to be even larger, Brazil will likely become a perpetual soybean exporter from this point forward."


--The USDA will release its weekly export inspections report at 11 a.m. ET Monday.

--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

--The USDA will release its monthly WASDE report at noon ET Thursday.

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

(END) Dow Jones Newswires

12-03-21 1601ET

Stocks mentioned in the article
ChangeLast1st jan.
CORN FUTURES (C) - CBR (FLOOR)/C1 1.13% 627 End-of-day quote.5.69%
WHEAT FUTURES (W) - CBR (FLOOR)/C1 -2.81% 795 End-of-day quote.3.15%
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