Another round of new lows

Wheat

Wheat struggled last week, trading with losses in every session. The losses started off small, but accelerated toward the end of the week. Wheat's issue continues to be centered on record world production and poor quality. With so much low-quality wheat in the world, the price has to drop to be competitive with corn, as those two markets will have to compete to see which one gets into the feed ration. For the week ending Sept. 18, December Minneapolis dropped 27.75 cents, December Chicago dropped 20 cents and Kansas City December slipped 23.5 cents.

Wheat struggled to start the week, as all three exchanges traded with small losses and to another round of new lows. The biggest issue in wheat came from reports that this year's world wheat production will be at an all-time record. Reports that Saudi Arabia bought 22.4 million bushels of wheat over the weekend from the U.S., European Union and Australia helped limit losses. The Sept. 16 session marked the sixth session in a row wheat closed lower. The U.S. dollar remains strong, which is hurting U.S. export demand. Reports had the most recent Egypt sale going to France.

The Sept. 17 session was the best performance, with most closing mixed. The only exchange that was able to hold gains was Chicago, which was supported by technical buying as traders try to pick a bottom. Kansas City and Minneapolis continued to struggle as improving weather conditions pressured those markets. Rain is in the forecast for the Southern Plains and that will help alleviate dry conditions and help with newly seeded winter wheat emergence. The Northern Plains is experiencing warm dry conditions that will help push harvest activity.

The December Chicago contract set another new low Sept. 18 as wheat closed with losses across the board. Scattered showers across the southwest plains will slow winter wheat planting in the near term, but improved soil moisture is well worth it. Clear and warm weather should help the spring wheat harvest move along. Informa reported that Japan bought 85,300 metric tons of food wheat from the U.S. and an additional 23,800 metric tons from Canada.

As of Sept. 14, 74 percent of the nation's spring wheat crop was harvested, compared with 58 percent the previous week and 86 percent for the five-year average. Winter wheat planting is estimated 12 percent completed, compared with 3 percent the previous week and 11 percent for the five-year average.

Corn

The corn market traded near its contract lows last week with a better weather forecast and harvest pressure. Early in the week, the weather forecast was for lower temperatures in the extended forecast, but by the end of the week, they were warmer for the Midwest through the end of the month. The yield reports continue to exceed expectations as the combines work north and that has also limited buying interest. Buying interest remained sidelined again last week with talk that big crops get bigger. As of Sept. 19, the December contract was down 5.25 cents for the week and posted a new contract low at $3.33, while the March contract lost 5.25 cents.

The corn futures closed with small gains on Sept. 15 and 16. There were some fresh export sales to start the week and the Farm Service Agency released its acreage estimates on Sept. 16. FSA's planted acre estimate was 84.833 million acres for corn versus USDA at 91.6 million and that 1.58 million did not get planted because of unfavorable spring weather. FSA also stated the information was incomplete, as not all of the offices reported because they are working on other programs and the numbers will be updated in the next couple of months. We also have to remember that not all farms participate in the farm program.

Selling pressure came back into the trade to end the week. The crop conditions remained unchanged for the third week in a row at 74 percent good to excellent and this year's crop is the highest rated since 1994. The forecast is also showing warmer temperatures in the 11-day timeframe for the Midwest, which reduces the chance of frost and helps the crop reach full maturity. Additional weakness came from better-than-expected yields and a firming dollar. The ethanol stocks are also at the highest level since mid-March.

The crop progress report has the corn rated at 74 percent good to excellent, 19 percent fair and 7 percent poor or very poor. Ratings were 53 percent, 29 percent and 18 percent, respectively, one year ago. Corn harvested is at 4 percent versus 4 percent one year ago and a five-year average of 9 percent. Dented corn is at 82 percent versus 79 percent one year ago and a five-year average of 85 percent. Mature corn is at 27 percent versus 20 percent one year ago and a five-year average of 39 percent.

Soybeans

As of the Sept. 18 close, November soybeans were 13.75 cents lower for the week. At 11 a.m. Sept. 19, November soybeans were trading 11 cents lower.

Overnight trade was lower to start the week, but profit taking and steady buying turned the market around into midday to close with moderate gains. The National oilseed Processors Association reported that 110.63 million bushels of soybeans were crushed in August, slightly less than expected. The Sept. 15 export inspections were decent, as they came in above the amount expected. USDA reported a sale of 118,000 metric tons of new-crop soybeans to China.

Soybean trade was higher overnight and early Sept. 16, following another announced sale to China, this one for 4.8 million metric tons of new-crop soybeans. Once the day trade opened, commercial selling took over and sent the market into negative territory to close with losses. The Sept. 16 crop progress report showed crop conditions unchanged from the previous week at 72 percent good to excellent, while soybeans dropping leaves were at only 24 percent, compared with 32 percent for the five-year average. The FSA estimated soybean acres at 80.4 million with an estimated 841,000 acres of prevent plant, up from 827,000 acres for the previous estimate.

Soybean trade was quietly higher Sept. 17, following an announced sale of 620,000 metric tons of new-crop soybeans to China. It should be noted that this sale is likely part of the larger sale announced Sept. 15. Demand for soybeans remains strong with 52 percent of USDA's export estimate already accounted for, but the market remains bearish because of continued expectations for a record harvest.

November soybeans set a new low close for the contract Sept. 19, with expectations for a record harvest continuing to weigh on the market. Basis has been slipping as processors and exporters begin to receive fresh supplies.

Soybeans dropping leaves were at 24 percent, compared with 12 percent the previous week and the five-year average of 32 percent. Conditions for soybeans were unchanged at 72 percent good to excellent, 22 percent fair and 6 percent poor or very poor.

Barley

As of Sept. 14, barley harvest was estimated at 91 percent complete, compared with 81 percent the previous week and 90 percent for the five-year average.

Sept. 18 cash feed barley bids in Minneapolis were at $2.35 per bushel, while malting bids were $6.35.

Durum

As of Sept. 14, 34 percent of North Dakota's durum crop was harvested, compared with 20 percent the previous week and 68 percent for the five-year average. North Dakota's durum crop condition rating was 74 percent good to excellent, 20 percent fair and 6 percent poor or very poor, down 3 percent from the previous week.

Sept. 18 cash bids for milling quality durum were at $10 per bushel in Berthold, N.D., while the Dickinson, N.D., bid was at $11.

Canola

Canola futures on the Winnipeg, Manitoba, exchange closed with $7.30 (Canadian) losses for the week ending Sept. 18. Canola started the week off with gains. Early week support came from spillover buying from a stronger U.S. soybean complex with light support coming from weather concerns, as much of the major canola growing regions experienced freezing temps over the weekend. The rest of the week had canola on the defense, trading to a new contract low by Sept. 18. Selling was tied to spillover pressure from a lower U.S. soybean complex, as well as from improving weather forecasts, which should allow for harvest progress to advance.

As of Sept. 14, North Dakota canola was 40 percent harvested, compared with 18 percent the previous week and 59 percent for the five-year average. Canola's crop condition rating decreased 4 percent to 84 percent good to excellent, 14 percent fair and 2 percent poor.

Sept. 18 cash canola bids in Velva, N.D., were $15.78 per hundredweight.

Dry edible beans

As of Sept. 15, North Dakota's dry bean crop (40 percent of the nation's crop) was 16 percent harvested, compared with 8 percent the previous week and 25 percent for the five-year average. North Dakota's crop was rated 63 percent good to excellent, 25 percent fair and 12 percent poor or very poor, 2 percent less than the previous week. Minnesota's crop (7 percent of nation's crop) was 37 percent dropping leaves, compared with 12 percent the previous week. Minnesota's crop was rated 53 percent good to excellent, 33 percent fair and 14 percent poor or very poor, down 2 percent from the previous week. Nebraska's crop (10 percent of nation's crop) was 15 percent harvested, compared with 4 percent the previous week and 23 percent for the five-year average. Nebraska's crop was rated 83 percent good to excellent, 14 percent fair and 3 percent poor or very poor, 1 percent higher than the previous week. Michigan's crop (12 percent of the nation's crop) was 7 percent harvested, compared with 1 percent the previous week and 14 percent for the five-year average. Michigan's crop was rated 69 percent good to excellent, 24 percent fair and 7 percent poor or very poor, unchanged from the previous week.

Sunflowers

As of Sept. 14, North Dakota's sunflower crop was 19 percent bracts turning yellow, compared with 4 percent the previous week and 50 percent for the five-year average. North Dakota's sunflower crop was rated 79 percent good to excellent, 18 percent fair and 3 percent poor, a 4 percent decline from the previous week.

Sept. 19 cash sunflower bids in Fargo, N.D., were at $17.25 per hundredweight.