This is the SFN Market Report with Brooks Schaffer of Palmetto Grain. Reach him at [email protected] or 843-540-4540.

We got USDA’s latest supply and demand estimates on Friday. The market only expected very minor adjustments and that is what USDA delivered. USDA pegged corn carryout just barely below the psychologically important 2 billion bushel level at 1.999 billion bushels and left bean carryout unchanged from the Sept report at 550 million bushels. That is a very burdensome carryout for beans compared to 345 million bushels last year and more than twice the 2022 carryout of 264 million bushels. On yield they raised corn yield 2 tenths of a bushel and took beans down a tenth. These yield estimates are still above trend and would both be record yields but not as big as we had feared earlier. Interesting to note that while total bean production is estimated to be a record, corn production is estimated just below last year despite the higher yield. That is due to the acreage reduction. The market feels like we now have a better handle on crop size and will not be looking for any dramatic changes in crop size from here unless something changes.

World carryout numbers came in very close to last month’s estimates and very close to the middle of the range of expectations so no surprise there either. World corn carryout was down just a bit, bean carryout almost unchanged and wheat carryout up just a hair from last month.

Updated drought monitor last week showed how extensive drought has developed across the growing regions. Soybeans are being harvested in the Midwest at single digit moisture levels which is taking some yield from producers but welcomed by processors. Harvest is flying with soybeans harvest pace well ahead of average and fastest in over 5 years. Corn should be making up some ground too and be well ahead of average. We did not get updated harvest progress from USDA yesterday due to the Columbus Day holiday. It will come out today at 4pm.

Market will go back to trading South American weather, US harvest progress and geopolitical risks. The rains are forecast to start next week in Brazil. If they fall as forecast, it will start the growing season off just a little behind but without losing any yield potential. We are going to see rapid planting progress down there. That has caused most of the weakness in the soybeans the last several sessions. Soybeans closed below $10 on Monday and corn came too close for comfort to support on the December corn at $4.07.