Weekly Ag Market News Rewind 11/8/26
The week of November 2 to 8 was shaped by the U.S. midterm elections, shifting hopes for an end to the war with Iran, and uneven export demand: strong for soybeans, weak for wheat and puzzling for corn. Traders also positioned ahead of USDA's November crop report due on Tuesday, November 10.
WTI crude oil fell more $10 to ~$90, as talks between Iranian and Qatari officials and Trump's comment that a deal could happen raised hopes of ending the U.S.-Israeli war with Iran. Stock futures dropped sharply when a strong Democratic showing became clear on Tuesday night, but equities rallied on Wednesday on expectations of a quick end to the war. On Thursday the Nasdaq lost over $2 trillion in value as Democrats began discussing regulation that could slow the AI buildout.
U.S. economic data stayed solid but cooled. The Composite PMI fell to 55.9 in October from 58.4 in September, but still in expansion territory above 50 points, while manufacturers reported the fastest input-cost inflation since May. Unemployment eased to 4.1%. Diesel averaged $6.27 per gallon.
On trade, China said it will buy more U.S. farm goods only if both sides implement their reciprocal tariff-cut agreement. A Brazilian analyst noted that Chinese state-owned firms keep buying U.S. soybeans while private crushers, who must pay the tariff, stay with Brazil, and he expects the election to change nothing here. Trump said his administration has the concept of a new trade deal with Canada but gave no details.
Corn was the most puzzling market. USDA announced flash sales of 1.73 million tons to Mexico on Monday, the ninth-largest one-day corn sale announcement in history, yet December futures settled only half a cent higher and later made a new four-month low. Falling soybeans and crude oil weighed on prices, and traders may also be worried about a larger crop. Export sales through October 29 were about a third behind last year, while USDA projects only a 4% decline in exports for the year. Harvest reached 74%, slightly behind the 77% average, as of last Sunday.
Soybeans futures fell sharply as lower crude oil hurt the biofuel outlook, but exports remain the bright spot. Old-crop weekly sales were about 1.5 million tons, 11% below a four-week average lifted by a marketing-year-high 2.5 million the week before. The seasonal shift is near: importers usually start moving to South American supplies in November, as Brazil harvests in January. September crush was 3% below a year ago, and U.S. harvest was 88% complete as of last Sunday, ahead of average.
South American weather is in focus as El Niño continues. Brazil's soybean planting was 53% done by October 29, ahead of last year, but many areas have gone 15 to 20 days without rain and with high temperatures just as early beans start flowering, so rainfall next week is critical. Mato Grosso had a wet October, but more forecasters now expect warmer and drier weather in the second half of November. Southern Brazil has been too wet, and Argentina's rainy spring helped produce a record wheat crop, though continued rain through harvest could hurt its quality and yields. The U.S. Corn Belt outlook turned drier.
Wheat export demand was weak. U.S. weekly inspections were the lowest in records back to 1983, season-to-date sales are 28% below last year. Prices fell Tuesday after the U.S. confirmed it will mediate Russia-Ukraine talks on November 10 and 11 in the United Arab Emirates. Supply estimates edged lower: the EU cut its wheat crop a bit, and IKAR agency cut its Russian wheat export forecast by 6% to 39.5 million tons. Russia's October wheat exports were the season's highest at 2.9 million tons but far below last year's 5.4 million, with railways congested. Globally, the UN cereal price index fell 4.5% in October and is 12.6% below a year ago.
Attention now turns to USDA's November report. Analysts surveyed by Reuters expect the corn yield at 180.3 bushels per acre, 0.9 below October; for soybeans they see a 53.5 yield, up from 53.1. StoneX is well above the trade on corn at 183.1 bushels and sees soybeans at 55, though USDA's final corn yield has come in below StoneX's November estimate in 11 of the last 15 years. USDA also said it will use an AI tool to check the data in this report after errors in its September corn numbers.
Farm finances and inputs remain under pressure. The Ag Economy Barometer had 62% of farmers saying their balance sheets are strong, versus 75% in January. Canadian Nutrien reported low nitrogen sales, with squeezed farmers, especially in Brazil, delaying purchases, while potash global demand stays high. It expects U.S. farmers to catch up on fall fertilizer applications in coming weeks and is closing a Florida phosphate operation and a Trinidad nitrogen plant. European ammonia maker AGF Nitrogen halted some production lines because of high gas prices and weak demand, and Strait of Hormuz shipping constraints have pushed fertilizer prices beyond many farmers' budgets.
Farmdoc made a comparison of U.S. and Brazil farm costs. In a sample of farms, U.S. soybean costs averaged $616 per acre in 2020 to 2024 versus $416 in Brazil, and most of the gap came from overhead, mainly land, while direct input costs were similar, so cutting input spending alone is unlikely to close it.
India shows how El Niño is hitting demand: monsoon rainfall was nearly 13% below normal, corn and sugar prices jumped about 40% to record highs, and ethanol blending is expected to fall below its 20% target as food security takes priority.
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