Wheat Down Again on Russian Rainfall
By Kirk Maltais
--Wheat for December delivery fell 0.9% to $5.98 1/2 a bushel on
the Chicago Board of Trade Friday following Russian wheat price
down as rain showers hit the Black Sea region.
--Corn for December delivery were unchanged at $3.98 1/2 a
--Soybeans for January delivery rose 0.6% to $10.56 1/4 a
Washout: Managed money funds continued to move money out of
wheat Friday, adding up to a 5.4% drop in wheat futures this week.
The U.S. move appears to be following in lockstep with Russian
wheat futures, said Charlie Sernatinger of ED&F Man Capital.
"Over in the Black Sea, the Russian wheat FOB was said to be
$251/ton yesterday, down $2 from Wednesday," he adds.
Final Bets: With the presidential election just days away and
the end of October upon us, traders made their final bets on what
the election outcome could mean for grains, said Karl Setzer of
AgriVisor. "There is a significant amount of unknown that always
enters a market ahead of this event, mainly on what changes we may
see to global trade relations if we see a change in
administrations," said Mr. Setzer.
Afterburner: Corn futures could take a hit if Joe Biden emerges
as the victor in next week's election, mostly in the belief that a
Biden Administration would enact regulations designed to encourage
the proliferation of electric vehicles, which would slash gasoline
consumption and therefore ethanol usage. "There is a perception
that Biden will focus on eliminating gasoline-powered vehicles,
which is really bad for ethanol," said Sal Gilbertie of Teucrium
Trading. "If there is an election price reaction at all in the big
ag markets, it might be negative for corn on a Biden win."
Looking For Signs: With the U.S. grains harvest nearly
completed, traders are looking to the South American harvest for
signals on the direction of prices. "Growing season will be heavily
influenced this year by the rapid development of La Nina, caused by
the cooling of sea surface temperatures in the equatorial Pacific,"
said Arlan Suderman of StoneX. "Very favorable rainfall is expected
for central and northern areas of Brazil's soybean belt for the
summer months. The exception is southern areas of the belt that
could see significant moisture stress." Mr. Suderman adds that,"The
primary concern here would be if wet conditions are excessive in
February, slowing harvest and planting of the safrinha corn
Rays of Hope: In an earnings call Friday, Archer Daniels Midland
CFO Ray Young said that Chinese buyers are making inquiries about
importing ethanol from the U.S., which could help boost prices for
the corn-based fuel additive. Young is optimistic about prospects
for ethanol after the industry has struggled for years with high
production and low prices. But for now ADM expects to keep two of
its own plants offline through the winter. Economic data will help
determine when to reopen them, Young said, but he expects other
shuttered plants in the industry will remain closed
--U.S. Foods Holding Corp. will release third-quarter earnings
before the market opens on Monday.
--The USDA releases its weekly grain export inspections data at
11 a.m. ET Monday.
--The USDA will release its monthly grains crushings report at 3
p.m. ET Monday.
--The USDA releases its weekly crop progress report for the
2020/21 crop at 4 p.m. ET Monday.
--Mondelez International Inc. will release third-quarter
earnings after the market closes on Monday.
Jacob Bunge contributed to this article.
Write to Kirk Maltais at firstname.lastname@example.org
(END) Dow Jones Newswires
October 30, 2020 15:37 ET (19:37 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.