Fundamentally Speaking

Last month was tough for the grain and oilseed market bulls as the spot contracts for corn, soybeans, wheat, soybean meal and soybean oil all fell in October.

That is only the second time that has happened going back at least till 1988 other than October 2008.

Starting with corn, which fell 53 cents or 10.6% (the second largest decline since 1988 other than 2008) had the one-two punch of higher-than-expected 9/1 stocks and a jump in the October yield estimate which added over four hundred million bushels (mb) to the 2026/27 supply.

This precipitated massive fund liquidation from what had been a near record long position along with doubts as to whether export sales will reach the 3.30 billion bushel (bb) USDA projection.

As for soybeans, values were down thirty-four cents last month, a mere 2.7% decline, though losses continued at the start of this month with the funds still surprisingly long a large amount of contracts from what had been a record long position.

Forecasts of a record U.S. crop along with ideas that further yield increases may be seen and a favorable start to the South American growing season has more than offset the Chinese buying which so far has been what had been expected.

The products also tumbled in October with soymeal futures coming off huge fund sales from what also had been a record long position with prices down 9.1% last month, the third largest October decline since 1988.

Finally, wheat futures fell 72 cents per bushel in Chicago or down 10.7%, the largest percent drops in October since the 2007 and 2008 years as our export sales have been quite slow.

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