Today’s FarmLead Breakfast Brief reviews how grain prices are tracking where harvest is at in North America, planting is at in South America, and what should we expect from Thursday’s November WASDE grain report.
Thrills are much more about anticipation than action. An unfired bullet is more dangerous than one that has already met its target.”
– Ashwin Sanghi (Indian author)
Grain prices this morning are mostly in the red.
The main reason: The U.S. Dollar continues to rebound from a down day on Monday.
Yesterday, the USDA came out with on their last crop progress updates for 2017. 
The agency says that the corn harvest is behind. Soybeans, however, are nearly wrapped up.
Also U.S. grain inspections for last week totaled 10.4 million bushels of wheat, 17.5 million bushels of corn, and 91.5 million bushels of soybeans.
Converting these bushels into metric tonnes via GrainUnitConverter.com, it means 283,000 MT of wheat, 444,500 MT of corn, and 2.49 million tonnes of soybeans got shipped out last week.
These numbers were a bit of a disappointment though. They’re down 6%, 46%, and 9% from shipments made a year ago, respectively.
As Garrett mentioned in Grain Markets Today, the soybeans exports number is the most noticeable. Total U.S. soybean exports year-to-date are tracking behind last year’s pace by 53.7 million bushels (or 1.46 million tonnes).
This, when the USDA is currently forecasting US soybean exports to climb 3.5% to 61.2 million tonnes in 2017/18.
Where soybeans demand continues to be decent is in Brazil. Oilseeds association, ABOIVE, says that while exports have been strong out of Brazil, crush demand has also improved. Through August, the country has used 25.7 million tonnes. That’s a new record.
However, ABOIVE says that domestic crushers have slowed down their purchasing lately.
That known, Safras e Mercado says that Brazilian farmers have only sold 19% of their new crop (the one that’s just getting seeded). A year ago, 25% was forward-contracted, and on average, 29% is sold by now.
Crop Progress Update
Staying in Brazil, AgResource reports that planting speed is picking up. The largest-producing state in Brazil, Mato Grosso, now has 60% of its soybeans seeded. 
AgRural says that across all of the country, 43% of soybean acres are planted, in-line with the 5-year average of 44%.
Heavy rains will likely hit Northern Brazil into this weekend. In Argentina, forecasters are expecting drier weather next week (and it’s needed).
Here in North America, US 2018/19 winter wheat crop planting has caught back up with the average schedule: 91% is in the ground.
75% of the crop has also emerged (77% average) and 55% of it is rated good-to-excellent. This figure is up 3 points from last week but still a bit behind the 58% G/E rating a year ago.
As of Sunday, the USDA says that the US corn harvest is 70% complete. Usually, its 83% done by now. Technically, this was a 16-point improvement week-over-week, but there’s still a lot of corn left out there.
We’ve seen the most notable delays in the following states:
• Iowa – currently at 67% harvested vs. usual 84% by now;
• Minnesota – currently 60% combined vs. 87% average;
• Nebraska – currently 68% combined, normally 81%;
• North Dakota – currently 59%, usually 73% by now; and
• South Dakota – currently 61%, usually 80% combined after the first weekend of November.
For the US soybean harvest, 90% of the crop has been taken off, in-line with the five-year average of 91%.
72% of US sorghum crop has been harvested, slightly behind the usual pace of 78%.
WASDE Corn Expectations
The market is expecting the November WASDE on Thursday to show higher corn yields in the US. In the October WASDE, the USDA said average corn yields were 171.8 bushels per acre.
The average guesstimate ahead of this Thursday’s WASDE is for 172.4 bushels per acre. Ours is a bit lower than that. (see chart below).
There have been nine times in the last 30 years that corn yield forecasts were increased each month from August through October. Only twice, in those nine years, was the November forecast below the October one. 
Translation: it’s unlikely that we a see a decline in the USDA’s current estimate of corn yields in November. However, there’s certainly a chance.
The main driver of this likelihood is the delay in the US corn harvest (as mentioned above). If the USDA recognizes that harvest is behind, the average yield should come down.
The question comes down to whether the USDA will do that this Thursday, or on Friday, January 12. That’s when the first WASDE of 2018 comes out.
On the demand side, not much is expected to change for corn. We mentioned a few weeks ago how “giving a cow” could help corn prices in the short-term.
However, in the long-term, there needs to be a production shock. And it doesn’t necessarily need to come in America.
As per the USDA’s office in Pretoria, corn acres are expected to drop 9% in the African nation for the 2017/18 crop.  This means that just under 6 million acres of corn will get seeded.
The reason for the drop is the decline in prices after South Africa produced a record corn crop in 2016/17 of 17.5 million tonnes.
This year, however, it’s estimated that the crop will be just 12 million tonnes.
Looking elsewhere, Russia is dominating wheat headlines lately, but the USDA’s attaché in Moscow recently lowered their corn harvest estimate.
The office is now estimating a Russian corn crop of 13.8 million tonnes, down 1.7 million from the previous estimate. This, despite more acres seeded and a good harvest pace, lower yields in 2017/18 was to blame.
Specifically, Russian corn yields are forecasted to be 76 bushels in 2017/18. This would be down 13% from last year’s 88 bushels per acre average.
Ultimately, we’re going to need more of these types of production issues to get corn prices to improve.
Keep in mind that corn prices for 2018/19 delivery DO continue to impress. Same thing for 2017/18 winter wheat prices. Consider forward contracting 10% today – post on the FarmLead Marketplace now and lock up some cash price risk ahead of the WASDE.
At 7:20 AM CDT in the North American futures markets (*not cash prices*):
(all prices in dollars per bushel unless otherwise indicated)
$1 USD = $1.2763 CAD, $1 CAD = $0.7835 USD)
Dec Corn: -1¢ (-0.3%) to $3.47 USD or $4.429 CAD
Jan Soybeans: -1.8¢ (-0.2%) to $9.923 USD or $12.664 CAD
Dec Soybean Meal (per short ton): -$0.60 (-0.2%) to $315.50 USD or $402.68 CAD
Dec Soybean Oil (cents per lbs): unchanged at 34.73¢ USD or 44.33¢ CAD
Dec Oats: +0.3¢ (+0.1%) to $2.693 USD or $3.437 CAD
Dec Wheat (Chicago): -4.3¢ (-1%) to $4.265 USD or $5.444 CAD
Dec Wheat (Kansas City): -4.5¢ (-1.05%) to $4.255 USD or $5.431 CAD
Dec Wheat (Minneapolis): +0.3¢ (+0.05%) to $6.313 USD or $8.057 CAD
Jan Canola: +0.9¢/bu / +$0.40/MT (+0.1%) to $9.228/bu / $406.87/MT USD or $11.778/bu / $519.30/MT CAD
COMMODITY TRADING INVOLVES RISK AND MAY NOT BE SUITABLE FOR ALL RECIPIENTS OF THIS POST. Neither the information presented, nor any opinions expressed, constitutes a solicitation for the purchase or sale of any commodities. The thoughts expressed in this email and basic data from which they are derived are believed to be reliable, but cannot be guaranteed due to uncertainty about future events and complexities surrounding commodity markets. Those acting on the information are responsible for their own actions.