By Kirk Maltais


--Soybeans for November delivery rose 0.8% to $13.60 1/2 a bushel, on the Chicago Board of Trade on Thursday, with traders attempting to ascertain what hot and dry weather will mean to the upcoming soybean harvest.

--Corn for December delivery fell 0.4% to $4.80 1/2 a bushel.

--Wheat for December delivery fell 0.6% to $5.93 3/4 a bushel.


HIGHLIGHTS


Supply Story: Soybean futures finished the day higher, with traders considering the effects that the wave of hot and dry conditions has had on maturing soybean pods. "Soybeans bounce following recent losses on ideas that supply risks remain very much alive in the Midwest," said Arlan Suderman of StoneX in a note. "Traders don't have enough evidence of those supply threats to justify sustaining a rally at this point, but neither do they want to be caught short if yields continue to decline."

Underwhelming: The future of Black Sea wheat exports remains unclear, which applied pressure to wheat futures today. Ukrainian wheat is piling up with nowhere to go, while cheap Russian wheat exports keep setting the tone for global prices, said John Payne of Hedgepoint Global. Today's export sales report from the USDA showed that the U.S. is still not a competitive source of exports. "The market wants to see the U.S. win some biz, it just hasn't happened yet," said Payne. The USDA said in its weekly export sales report that sales of wheat for the 2023/24 marketing year totaled 437,900 metric tons--on the high end of analyst projections, but not a strong enough figure to excite traders.

Caught in a Range: In the days following the September WASDE report, CBOT corn futures have been unable to break past $5 a bushel - falling below it in July after trading above that level for roughly 2.5 years. Corn early harvest reports have been a mixed bag, but the supply picture is comfortable, said Doug Bergman of RCM Alternatives in a note. "With room on the balance sheets for yield to come down, the market is trading as if the future drop won't be enough to make U.S. supplies tight," said Bergman.


INSIGHT


Growing Patches: Crop-growing conditions in states hurt by extremely hot and dry weather continued to worsen, according to the latest report from the U.S. Drought Monitor. Areas of extreme or exceptional drought grew in the northern portion of the country -- with Minnesota, Wisconsin, Iowa, Illinois Missouri, Nebraska and Kansas all seeing growth of the dry patches in their state through September 12. Texas and Louisiana also saw growth to their dry spots, with the entirety of Louisiana swallowed up in extreme and exceptional drought. Dryness comes as harvesting ramps up in the Midwest -- beginning with corn and proceeding into soybeans by next month.

Strong Symptom: The Climate Prediction Center reports that El Niño is in place, and is practically certain to keep ocean waters over 1 degree Celsius from normal through next year. Odds of a strong event--lifting ocean temperatures by over 1.5 degrees Celsius--remain good, with the Climate Prediction Center giving an over 70%-chance for a strong El Niño to develop in either October or November. However, the odds plummet around the turn of the year, sinking to an only 3% chance by next April. How strong El Niño is, and for how long, will be important for farmers as harvesting progresses and they look towards next spring's planting season.


AHEAD


--The CFTC will release its weekly Commitment of Traders report at 3:30 p.m. ET Friday.

--The USDA will release its weekly grains export inspections report at 11 a.m. ET Monday.

--The USDA will release its weekly crop progress report at 4 p.m. ET Monday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

09-14-23 1550ET