Grain Comments: 07.11.24

Good morning. New lows again for new crop beans to start the overnight session, but prices have since found a bid and are trading higher at the moment; corn and wheat futures are also higher as traders are likely covering short positions heading into tomorrow’s report. It is unlikely that the USDA makes any groundbreaking adjustments tomorrow, but you never quite know what surprises may be in store on report day. Traders are also wondering whether yesterday’s new crop soybean sale to China was the start of a bigger buying program, or just a one-off purchase because the price was right. Corn futures are trading 3-5 cents higher this morning, soybean futures are 6-10 cents higher, and the Chicago wheat market is up 8-10 cents. Products are higher, soybean meal is up $1-3/ton, and soybean oil is up 70-80 points. Outside markets are mixed, crude oil futures are up around 30 cents/bbl, the Dow Jones index is down 70 points, and the US$ index is down 20 points. The NASDAQ and S&P500 are marginally lower after again making new record highs yesterday.

Today’s Reports: June Inflation/CPI; Weekly Jobless Claims; Conab July Crop Report; US Weekly Export Sales

• Deliveries on Thursday included 25 contracts of corn, 20 contracts of soybeans, 102 contracts of wheat, and 43 contracts of soybean oil.

• This morning’s weekly export sales report for the week ending July 4th is expected to show old crop corn sales in a range of 300k-850k mt’s, and old crop soybean sales in a range of 200k-600k mt’s.

• For the 2024/25 crop year, corn sales are estimated between 0-500k mt’s, soybean sales are estimated between 50-300k mt’s, and wheat sales are seen between 300k-700k mt’s.

• Conab is set to release its July supply and demand report this morning for Brazil; traders see the report showing soybean production for the current season at 147.89 mmt’s, compared with the June estimate of 147.35 mmt’s. Planted acres are seen mostly unchanged from last month at 45.97 mil ha’s.

• The trade estimates Conab’s total corn production number to come in around 115.48 mmt’s, up from June’s 114.14 mmt’s. Planted area is seen at 21.05 mil ha’s, which would be up slightly from the previously estimated 20.838 mil ha’s.

• According to Ukraine’s Ag Ministry, the country has exported 1.13 mmt’s of grains and legumes so far in the season started July 1; this is up 62% from the same period last year.

• European farm lobby Copa-Cogeca estimates cereal production out of the EU in the 2024 season at 257.3 mmt’s, which would be down 4.7% from last year, and would also be below the five-year average. Wheat production is seen 6% lower, while barley production is seen 9% lower.

• For tomorrow’s July WASDE report from the USDA, the trade sees corn ending stocks in the 2023/24 season at 2.047 bil bu’s, compared to June’s 2.022 bil bu’s. Soybean ending stocks for the same year are seen at 357 mil bu, compared to 350 mil bu last month.

• Corn ending stocks in the 2024/25 season are estimated at 2.289 bil bu’s, compared to 2.102 bil in June. Soybean ending stocks are seen at 447 mil bu, compared to 455 mil bu last month.

• Production estimates are seen mostly unchanged from last month; corn production is seen at 15.051 bil bu’s, up from June’s 14.860 mil bu’s. And soybean production is seen at 4.424 bil bu’s, compared to 4.450 bil in June.

• June inflation data is the number one item on the financial docket for Thursday, with economists forecasting the slowest annual growth pace in the last five months at 3.1%. The core number, however, is still seen remaining stubbornly higher at 3.4%.

• Fed Chair Jerome Powell told congressmen Wednesday that he believes inflation is receding, but that he isn’t yet confident that it’s sustainably slowing toward the central bank’s goal.

• Showers and thunderstorms lingered through the Northeast and the Ohio River Valley on Wednesday, with satellite data showing precip totals of 1-3″ through the broader Northeast, with scattered trace to 1″ showers observed through the Central Corn Belt (S MN/IA/N MO/IL).

• For the rest of this week and weekend, models see a mostly dry pattern developing while chances for thunderstorms exist mostly in the wet areas of the Northern Corn Belt. The EU model sees the chance of 0.1-1″ for these areas through early Monday morning.

• Otherwise, the models continue to be in fairly good agreement over the next week’s forecast on both precip and temps; Moisture will be mostly confined to the Ohio River Valley and far Northeast, while temps look to be above average on both coasts, while the mid section of the country stays average to slightly below average.