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Corn Outlook:
Corn harvest is getting underway with a mammoth crop searching for bin space. With a record crop being forecast, strong demand is essential to offset an oversupply. With the cattle inventory at a 70-year low, exports will have to pick up the slack. They were dynamic for the 2024-25 marketing year, but for 2025-26, shipments must average 55.2 MB each week to meet USDA’s target of 2.875 BB. Last week, the first week of the new marketing year, inspections were 56.8 MB, the highest start since 2016. While this is optimistic, will it last? Probably not, as world stocks are forecast at a record, and Argentina is expected to increase their acreage 9.6 percent. The bottom line is corn faces a long road because of increased supply and cannot afford a hiccup in exports.
Bean Outlook
It is no secret that China has been shunning imports of U.S. soybeans, as they have not received a shipment from us since early June. Inspections last week were below the previous week at 16.6 MB. Usually, they pick up in late September-early October when China’s interest rises. However, that may not happen this time as they have made purchases from Brazil through October. My thoughts are the U.S. may be a source, but only if there is a shortfall in South America. Meanwhile, an issue getting my attention is the summit meeting last week between China, Russia, and India. This is a concern because of China’s intent for a new world order that excludes the U.S. If other trading partners join, especially those in the Pacific Rim, who are dissatisfied with the Administration because of the tariffs imposed, it could pose a real threat to our economy.
Wheat Outlook:
Fresh news in wheat remains sparse. Harvest of the spring crop is winding down at 85 percent complete compared to 83 percent a year ago and 84 percent for the average. Meanwhile, SovEcon has raised Russia’s production estimate to 86.1 million tons from 85.4 million, which means we will be facing increased competition from them. Looking at exports, inspections fell sharply from the previous week to 15.6 MB. To reach USDA’s target of 875 MB, we must ship 16.1 MB each week. Currently, the pace remains on track to meet that projection.
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