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Since last week, the grains have been under considerable pressure as they are in the midst of harvest, while the lockdowns in China have put a dent on demand. Also, the low water levels on the Mississippi and Ohio Rivers are disrupting barge traffic to the Gulf. Looking at corn, export inspections last week were mediocre at 17.6 MB and must average 43.9 MB on a weekly basis to reach USDA’s projection of 2.150 BB. Currently, shipments are only running at 65 percent of their pace for the past 2 years. With the dollar standing at a 20-year high, it is unlikely that exports will get much help unless it drops sharply, or adverse weather becomes an issue in South America. In other developments, harvest is running at a brisk pace, and is 45 percent complete compared to 40 percent for the average.
Soybean exports rebounded this week with inspections a marketing year high of 69.1 MB and China taking 49.5 MB. While this is impressive, it is probably because of China securing last minute needs from the U.S. before their focus turns to South America next month. The switch in interest generally causes our exports to peak by mid-November and head south for the remainder of the marketing year. Unless weather becomes a factor in Brazil, I see little reason for swaying from the norm. Currently, their planting is 24 percent complete with the expectation for a record crop. Looking at harvest, it is sailing along at 63 percent done versus the average of 52 percent.
The direction of wheat seems to be tied exclusively to the latest development in the Ukraine-Russia conflict. Early this week, reports surfaced that discussions would continue regarding the extension of the agreement of Ukrainian grain exports which caused prices to tumble. It is in Russia’s interest to keep exports flowing from the Black Sea Region to keep NATO from slapping them with additional sanctions. In other matters, after several weeks of solid exports, inspections last were a mediocre 8.5 MB. For the past 3 weeks, the pace of shipments has fallen 25 percent. Looking at winter wheat planting, it is progressing without any glitches and is 69 percent done, just above the average of 68 percent.
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