Soybean Prices are Down, but it's NOT Trump's Fault

Grain Markets and Other Stuff

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🌱 Record Brazilian Soybean Crop Projected 🌾
Private consulting groups are forecasting a record Brazilian soybean crop for the 2023/2024 season. StoneX estimates the crop at 166.2 million metric tons (mmt), with exports reaching 103 mmt, while Celeres projects the crop to hit 170.8 mmt, with exports totaling 107 mmt 🌎. The favorable growing conditions and high-quality inputs are driving this projection, although StoneX highlighted ongoing concerns over dryness in southern Brazil 🌞. As of last Thursday, AgRural reported that 91% of the soybean area has been planted, up from 86% the previous week, and ahead of 85% planted at the same time last year 📈.
🏭 Cargill to Lay Off Thousands Amid Declining Profits 💼
Cargill, the global agricultural trading giant, announced plans to lay off 5% of its workforce, or around 8,200 workers, in response to financial pressures. The layoffs will mostly occur before the end of the year, impacting senior leaders but not top executives 🚶. Cargill’s profits have been hit by record global corn and soybean crops and the declining US cow herd, which is at its lowest level in seven decades 🐄. For fiscal 2024, Cargill reported a $2.48 billion profit, the lowest since 2016 📉.
💼 ADM’s Accounting Scandal Expands 📊
The investigation into ADM's (Archer Daniels Midland) accounting errors has expanded. The SEC launched a civil probe earlier this year after the company revised its earnings twice due to discrepancies in its Nutrition division 💼. ADM is facing accusations of inflating profits through manipulated intersegment transactions, which may have led to securities fraud 💸. The company maintains that the errors didn’t affect overall profits, but ADM’s stock continues to struggle, now valued at about half of its 2022 peak 📉.
📉 Funds Reduce Net-Long Position in Corn Market 🌽
"The Funds" have reduced their net-long position in the corn market, with large money managers selling 23,000 corn contracts last week 📉. Additionally, funds were net sellers of 10,000 contracts of soybeans and 1,000 contracts of SRW wheat 🌾. The decline in corn futures reflects shifting sentiment in the market, and the reduced positions come as part of broader adjustments by institutional investors 📉.
📦 US Soybean Shipments Decline, Still Strong Year-on-Year 📊
US soybean shipments declined slightly last week, with 2.1 million metric tons (77 million bushels) inspected for export, a 1.4% decrease compared to the previous week. However, shipments remain +78% higher compared to the same week last year 🌱. Corn shipments were down 7.2% from the previous week, and wheat shipments decreased by 19%. Despite these declines, both corn and wheat shipments were still higher than last year 📦.
🌾 USDA Reports Flash Soybean Sale 🚢
US exporters reported a flash sale of 134,000 metric tons (5 million bushels) of soybeans to China for delivery in the 2024/2025 marketing year 🇨🇳. While soybean sales started off weak this marketing year, they have since recovered and are now ranked as the sixth best in the last ten years, highlighting strong international demand for US soybeans 🌎.