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Corn Higher as Fund Traders Eye Harvest -- Daily Grain Highlights

09/15/2021 | 03:43pm

By Kirk Maltais

--Corn for December delivery rose 2.6% to $5.33 1/2 a bushel on the Chicago Board of Trade Wednesday, as the focus of fund traders turned to mixed yield reports from farmers harvesting crops.

--Wheat for December delivery rose 1.6% to $7.12 1/4 a bushel.

--Soybeans for November delivery rose 0.9% to $12.94 1/2 a bushel.

HIGHLIGHTS

Sickly Stalks: In the grains complex, corn futures were the focus of large fund traders Wednesday--as they purchased 9,800 contracts of corn through midday Wednesday, according to AgResource. Traders' interest stems from less-than-optimal yield reports among farmers harvesting their fields. "Early corn harvest data continues to be disappointing with disease-laden fields yielding 10-40 [bushels per acre] less that field surveys/farmer expectations," said the firm. "Stalk quality is exceptionally poor, and some corn plants are simply falling over. Any strong T-storm complex that produces gusty wind risks tangling corn fields and elevating harvest losses."

Feeling Optimistic: Hope that demand for U.S. corn exports will be strong was also a driver for futures Wednesday. "U.S. corn remains the cheapest feedgrain in the world and that will eventually generate export demand as we move toward the winter," said Tomm Pfitzenmaier of Summit Commodity Brokerage. "The seasonal low for corn is likely being forged and this is the time of year when end users seasonally see their best pricing opportunities." Traders surveyed by The Wall Street Journal this week forecast corn export sales being reported Thursday at anywhere from 350,000 tons to 1.2 million tons.

INSIGHTS

Not So Fast: The USDA said this morning that previously announced export sales of U.S. soybeans to China and unknown destinations have been cancelled for 2021/22 marketing year delivery--132,000 metric tons for China and 196,000 tons for unknown destinations. The announcement was a source of pressure for soybean futures this morning, and could be so again if Thursday's export sales report isn't strong. "Chinese demand continues to be in question," said Doug Bergman of RCM Alternatives. Grain traders surveyed by The Wall Street Journal forecast soybean sales for the week ended Sept. 9 at anywhere from 500,000 metric tons to 1.4 million tons, which is lower than the trend of recent weeks before Hurricane Ida.

In Flux: Daily production of ethanol in the U.S. is up this week, and more than forecast by analysts. In its Wednesday report, the EIA said daily production for the week ended Sept. 10 hit a rate of 937,000 barrels per day, up from 923,000 barrels per day in last week's report and more than analyst expectations for production. Meanwhile, ethanol stockpiles fell for the seventh consecutive week, declining to 20.01 million barrels from 20.39 million barrels the previous week. Analysts had forecast supply to be anywhere from 20.09 million barrels to 21.1 million barrels.

Switching Gears: With U.S. farmers out in the fields harvesting crops for this year, attention will soon turn to planting decisions for next year. U.S. farmers may find themselves increasingly choosing to plant soybeans over corn, said Pete Meyer of S&P Global Platts. According to Mr. Meyer, planted acres of soybeans in the U.S. may exceed corn by 2023, as demand for soyoil in renewable fuels runs up against what is currently a limited amount of supply. "The veg oil complex is going to be under tremendous pressure to produce enough feedstock for these guys, " said Mr. Meyer, referring to energy companies jumping into the markets for renewable fuels for both automobiles and airplanes.

AHEAD:

--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.

--The CFTC will release its weekly commitment of traders report at 3:30 p.m. ET Friday.

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

--The USDA will release its weekly crop progress report at 4 p.m. ET Monday.

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

(END) Dow Jones Newswires

09-15-21 1542ET

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