Grains were mostly higher following the USDA Quarterly Stocks Report and Small Grains Summary, but at noon soybeans are losing ground.
Jim McCormick, AgMarket.Net says the corn stocks were friendly coming in 84 million bushels below expectations at 1.76 billion bushels due to better feed demand and that data is supportive for the corn market.
He says the corn number was a little surprising to him considering the large amount of old crop corn farmers had in storage to move, especially on farm.
A close above $4.25 on the December contract could open the market to more technical buying and fund short covering.
Soybean stocks came in at 342 million bushels, close to pre-report estimates and the September WASDE ending stocks figure from USDA.
So, for the soybean market, McCormick says Brazil weather is the key moving forward.
“Some of our sources are indicating rain chances in the forecast in the 10 day period for Brazil which coincides with the start of their rain season. If this materializes the soybean market could move lower in a hurry,” he explains.
If the rain is a bust it could finally take November soybeans above the 100 day moving average.
Wheat stocks stored in all positions was slightly above estimates at 1.99 billion bushels.
All wheat production came in at 1.97 billion bushels, slightly lower than the August estimate, but above trade guesses.
Soft Red Winter wheat production was estimated at 342 million bushels, Hard Red Winter at 770 million, Other Spring Wheat 542 million.
McCormick says the wheat market is holding together as its taking notice of U.S. and global weather and production concerns.
Europe just down graded its production by 9%, coming in at a 12 year low.
The other key for the grains is whether or not the funds want to keep covering their short position into the new quarter.
McCormick says so far they have exited a large chunk of their short position but may need additional bullish news to keep going.
