Grain Comments: 07.03.23

Corn was 3-5 cents higher overnight and soybeans were up 35-40 cents while wheat was 1-2 cents lower as trade continued to position itself following following the June report data. The US dollar was higher while equities and energies were mixed.

 

Today’s Reports: Fats and Oils, Ethanol Crush, Crop Progress, Exports

 

  • US, Mexico, and Canada to meet on trade
  • May soybean crush est 189.8 mbu
  • May ethanol demand est 431 mbu

 

Trade will likely continue to react to last Friday’s USDA data in today’s session. The big shock in the market was the soybean acreage that came in 4 million less than what was projected in March. Given current yield and usage predictions this will leave the US with new crop ending stocks of just 140 million bu and require additional price rationing. Corn acreage estimates topped trade estimates at 94 million and removes nearly all need for rationing and diminishes how much risk premium is needed. Wheat data was closer to trade expectations. Once this starts to wear off, trade will revert to daily weather updates and actual field reports for price discovery. This will include the data that came out of the stocks and acreage reports. Trade will be volatile to start this week given tomorrow is the 4th of July Holiday. Trade will be open normal hours today, then closed tomorrow. Trade will restart Wednesday morning at 8:30 AM CT. Several traders will remain absent from the market until then. At the end of the week we will start to see more positioning in the market for the July WASDE report that will be released on Wednesday the 12th. This release will incorporate the stocks and acreage data from last Friday and given us a better indication of old crop ending stocks and new crop production. This is the report where interest really starts to shift from old crop to new crop.

 

Highlights

* Managed money exits recession hedges

* 95% chance of rate hike this month

* Trade expecting 25-basis point increase

* US rains stabilize crop condition

* Ratings still expected to decline tonight

* US mortgage demand is rising

* Global market leaves US out of trade pacts

* US crude oil supply declines

* Trade closed tomorrow for July 4th

* Markets re-open Wednesday morning

 

Corn

* Dec corn -93 ¼ cents last week

* June 1st stocks 4.1 bbu

* Planted acreage 94.1 million

* Harvested acreage 86.3 million

* Acres indicate carryout of 2.6 bbu

 

Soybeans

* Nov soybeans +33 ¼ cents last week

* June 1st stocks 796 mbu

* Planted acreage 83.5 million

* Harvested acres 82.7 million

* New crop carryout est 140 mbu

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