** 6:30 AM CDT CBOT Prices: Nov soybeans are up 8.00 cents at $9.7875, Dec corn is up 1.75 cents at $3.52 while Dec Chi wheat is up 2.0 cents at $4.545.
** AgResource AM Grain & Oilseed Comment: Good Morning! Mostly higher has been the overnight CBOT trade with corn, soybeans and wheat posting modest gains. Ongoing active domestic buying of Chinese soymeal along with technical demand has pushed CBOT values higher overnight. The end of the month/quarter loom next week, which has some funds seeing value in the cheap raw material space.
November soybeans have rallied to resistance at $9.80, the 200 day moving average and the early September highs, with the grains in tow. The volume of overnight trade has expanded from prior days with more than 23,000 contracts of November soybeans, more than 7,000 contracts of December corn, and more than 6,000 contracts of December Chi wheat changing hands.
Preliminary CBOT open interest for Thursday showed a decrease of 1,899 contracts in corn, 5,295 in soybeans and 1,375 contracts in Chicago wheat.
S&P downgraded credit ratings for China to AA-, citing rising debt levels increasing China’s future financial risks. The downgrades underscore the challenges faced by the world’s 2nd largest economy. Can China continues its rapid growth rate without the dramatic expansion of debt?
Also, China is questioning Thursday statements from President Trump that China has halted its banking relationship with North Korea. A Chinese foreign ministry spokesman commented that President Trump’s North Korea bank halt statement was not consistent with the facts. Further, it was stated that China continues to adhere to UN Security Council Resolutions.
The Midwest row crop harvest is really starting to quicken under hot/dry weather conditions that is allowing for rapid seed dry down. Some pre-weekend harvest hedge pressure is expected with producers reporting variable yields.
The Central US weather forecast features mostly warm/dry weather for the eastern three quarters of the Midwest for the next 6-7 days, with cooling to more seasonal temps to unfold next weekend. Heavy rains are slated to drop across the Plains and the NW Midwest starting this weekend with rain totals of .5-3.00”. A stalled front keeps the rain chances across the Plains and the NW Midwest for much of next week.
Midwest high temps into the middle of next week will be summerlike with readings ranging from the 80’s to the mid 90’s. The Delta will also sit in the warm/dry weather trend that will facilitate rapid harvest progress.
World weather forecasts need to be closely monitored. Brazilian crop areas north of RGDS look to hold in a hot/dry weather pattern into Oct 2nd with additional heavy rains slated to drop across Argentina. Ukraine/SE Russian farmers are planting a new winter wheat crop into dust amid a lack of rain. And too much rain is falling across the Russian crop areas farther west. Finally, the Australian weather forecast has limited rainfall chances for the next 10 days with crop estimates retreating to 18.5-19.5 MMTs on dryness.
ARC doubts that November soybeans can close above $9.80 resistance heading into a harvest weekend, but if they do, it’s a real sign of strength. The corn market is a follower, with wheat having a supply story tied to Aussie weather.
** 10 Day EU Model Forecast for South American Rainfall:
