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US Cash Grains-Corn, soybean basis steady-firm as futures dip

14 November 2017

Monday afternoon's U.S. Commodity Futures Trading Commission report is expected to include a managed fund short position in corn worth 210,000 contracts, vs. 203,000 the prior week; a net short in wheat worth 105,000, vs. 110,000 a week ago, and a net long in soybeans of 50,000, vs. 41,000 a week ago.

January soybeans were down 2.75 cents at 9.8425 USA dollars per bushel as of 1610 GMT in the morning trading, December corn was down 0.75 cent at 3.4275 dollars, while December wheat was down 7.25 cents at 4.2425 dollars.

2017/18 state corn yields continued to amaze, given the fact that this year's US corn crop did NOT enjoy a ideal growing season with challenges noted throughout the spring and summer in states such as South Dakota, Nebraska, Iowa, Illinois, and in...all five states ranked in the top six of total state corn producers in the nation. This pushed up in advance the soybean prices while dragging down the corn futures earlier this week.

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As for soybeans, the USDA data released on Thursday were not as bullish as the trade had expected, as the yield was left unchanged and stocks were only lowered 5 million bushels.

Minnesota is ranked fourth in corn production among the states, after Iowa, Illinois and Nebraska, with a 2016 crop value of slightly more than $5 billion. In total, the yield increases in the four states over the October projections increased corn production by 211 million bushels. The projection is 36 million bushels larger than past year. Thus far, no indication of strengthening export levels have materialized this marketing year. The state harvested 946.31 million bushels previous year.

The USDA said private exporters sold 135,000 tonnes of USA soymeal to the Philippines for delivery in the 2017/18 marketing year, which began October 1.

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The Chicago-based derivatives exchange told reports that the cash-settled Black Sea Wheat FOB (Platts) and Black Sea Corn FOB (Platts) futures contracts will instigate trades On December 18, 2017, focus to supervisory authorization. Similar to corn, soybean exports are also starting at a slower pace than a year ago. Weekly EIA estimates of ethanol production in October indicated a 3.4% increase over past year.

With the pace of exports below projections and grain and oilseed crushings above expectations, the outlook for total consumption remains uncertain.

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US Cash Grains-Corn, soybean basis steady-firm as futures dip