Good morning.
Choppy trade at the CBOT continues Thursday morning, as ag markets are again mixed. Corn and soybeans are lower, while the Chicago wheat market is marginally higher. Fresh fundamental news has been slow this week; we’re near the dog days of summer and most of the nation’s corn crop has pollinated, or is pollinating, under near-ideal conditions. The bull camp needs something new to chew on before any sort of rally will be able to unfold. Cash markets say the supply situation is tighter than most believe as basis has stayed firm, but fund managers and computer algorithms don’t care. Recent on-farm storage numbers would suggest the corn is there, it’s just in the hands of a tight-fisted farmer who doesn’t want to sell without some sort of basis incentive at these lower prices. This is the big question in the markets ahead of harvest. Corn futures this morning are trading 2-3 cents lower, soybean futures are trading 4-5 cents lower, and the Chicago wheat market is up 1-2 cents. Products are mixed, soybean meal is $1-2/ton lower, and soybean oil is up 20-30 points. Outside markets also a bit mixed, crude oil futures are down 5-15 cents/bbl, the Dow Jones index is down 50 points, and the US$ index is up 10 points. The S&P500 is up 5 points, and the NASDAQ is up 70 points after taking a beating on Wednesday.
This morning’s weekly export sales report for the week ending July 11th is expected to show old crop corn sales in a range of 500k-800k mt’s, and old crop soybean sales in a range of 150k-600k mt’s.
New crop corn sales are seen in a range of 25k-400k mt’s, new crop soybean sales are seen between 50k-400k mt’s, and new crop wheat sales are seen between 225k-600k mt’s.
The July Cattle on Feed report, out tomorrow afternoon, is expected to show the feedlot herd as of July 1 at 11.358 mil head, or 101% of last year. Placements are seen at 1.613 mil head, or 96.4%, and marketings are seen at 1.794 mil head, or 91.5%. The marketing rate is so much lower due to 2 fewer working days during the month this year.
There were rumors Wednesday that China had bought 4-6 cargoes of US soybeans out of the PNW; traders will be watching to see if these rumored sales show up on the daily reporting system at 8am central time this morning.
We also heard chatter Wednesday that farmer selling in corn had taken a jump as September futures traded back over $4. It seems the US farmer has almost reached the point of throwing in the towel on last year’s crop, as the bin space will soon be needed for the coming harvest.
Private ag company APK-Inform lowered their estimate of the 2024 soybean crop in Ukraine to 5.9 mmt’s, down 2% from their previous estimate. The group cited record high temps and drought across the growing areas as reasons for the cut.
Despite pending trade tensions with China, palm oil exports out of Indonesia in the month of June were up 58.8% from May at 2.797 mil tons. Sales to China totaled 483,529 tons, up from May’s 295,586 tons.
Several US farm groups have sent a letter addressed to Treasury Secretary Janet Yellen and US Office of Management and Budget Director Shalanda Young asking for clean fuel tax credits to include a requirement for domestic-only feedstocks.
The groups include the American Farm Bureau Federation, the American Soybean Association, the National Corn Growers Association, and the National Farmers Union.
Farmers have been upset recently over the use of imported used cooking oil from China being used to make renewable fuels, as opposed to soybean oil produced in the US.
A positive earnings update from Taiwan Semiconductor Manufacturing Co. helped restore sentiment in the tech sector early Thursday; this comes following the downward move this week caused by rhetoric of trade restrictions on China from the Biden admin.
Other equity market happenings on Thursday include a rate decision from the European Central Bank, as well as speeches from a trio of Fed officials. The trade sees the ECB leaving rates unchanged this month, while the Fed comments are some of the last before the July meeting at the end of the month.
US President Joe Biden has paused campaigning for re-election to self-isolate, as he has contracted Covid-19.
Similar to Tuesday, most of yesterday’s rainfall in the US was focused on the South and Southeast, while areas of the central Plains also picked up scattered moisture. Heaviest totals of up to 5″ were seen in small local areas of N AR/S MO, while the broader SE picked up anywhere from 0.1-2″.
Not a lot of forecast updates for Thursday, as the pattern of cool/dry weather for most of the Corn Belt persists. The GFS continues to be wetter in the Dakota’s/MN through the weekend than the EU model, but the two are in otherwise good agreement for the rest of the week.
Week-two forecasts have diverged a bit as well, as the GFS has turned drier in LA/AR/MS/GA while the EU stays wet in these areas. The CPC outlook is more in-line with the EU model than the GFS.
Warm air remains confined to the West and Northwest through the middle of next week, as the Midwest and most of the eastern half of the US will continue to see average to below average temps for the next 7 days.
The EU model remains wetter in areas east of the Black Sea, while the GFS has not pulled this moisture into its solutions. Otherwise, global forecast remains mostly the same from Wednesday.
Have a great day.
Grain Comments: 07-18-2024
Good morning.
Choppy trade at the CBOT continues Thursday morning, as ag markets are again mixed. Corn and soybeans are lower, while the Chicago wheat market is marginally higher. Fresh fundamental news has been slow this week; we’re near the dog days of summer and most of the nation’s corn crop has pollinated, or is pollinating, under near-ideal conditions. The bull camp needs something new to chew on before any sort of rally will be able to unfold. Cash markets say the supply situation is tighter than most believe as basis has stayed firm, but fund managers and computer algorithms don’t care. Recent on-farm storage numbers would suggest the corn is there, it’s just in the hands of a tight-fisted farmer who doesn’t want to sell without some sort of basis incentive at these lower prices. This is the big question in the markets ahead of harvest. Corn futures this morning are trading 2-3 cents lower, soybean futures are trading 4-5 cents lower, and the Chicago wheat market is up 1-2 cents. Products are mixed, soybean meal is $1-2/ton lower, and soybean oil is up 20-30 points. Outside markets also a bit mixed, crude oil futures are down 5-15 cents/bbl, the Dow Jones index is down 50 points, and the US$ index is up 10 points. The S&P500 is up 5 points, and the NASDAQ is up 70 points after taking a beating on Wednesday.
This morning’s weekly export sales report for the week ending July 11th is expected to show old crop corn sales in a range of 500k-800k mt’s, and old crop soybean sales in a range of 150k-600k mt’s.
New crop corn sales are seen in a range of 25k-400k mt’s, new crop soybean sales are seen between 50k-400k mt’s, and new crop wheat sales are seen between 225k-600k mt’s.
The July Cattle on Feed report, out tomorrow afternoon, is expected to show the feedlot herd as of July 1 at 11.358 mil head, or 101% of last year. Placements are seen at 1.613 mil head, or 96.4%, and marketings are seen at 1.794 mil head, or 91.5%. The marketing rate is so much lower due to 2 fewer working days during the month this year.
There were rumors Wednesday that China had bought 4-6 cargoes of US soybeans out of the PNW; traders will be watching to see if these rumored sales show up on the daily reporting system at 8am central time this morning.
We also heard chatter Wednesday that farmer selling in corn had taken a jump as September futures traded back over $4. It seems the US farmer has almost reached the point of throwing in the towel on last year’s crop, as the bin space will soon be needed for the coming harvest.
Private ag company APK-Inform lowered their estimate of the 2024 soybean crop in Ukraine to 5.9 mmt’s, down 2% from their previous estimate. The group cited record high temps and drought across the growing areas as reasons for the cut.
Despite pending trade tensions with China, palm oil exports out of Indonesia in the month of June were up 58.8% from May at 2.797 mil tons. Sales to China totaled 483,529 tons, up from May’s 295,586 tons.
Several US farm groups have sent a letter addressed to Treasury Secretary Janet Yellen and US Office of Management and Budget Director Shalanda Young asking for clean fuel tax credits to include a requirement for domestic-only feedstocks.
The groups include the American Farm Bureau Federation, the American Soybean Association, the National Corn Growers Association, and the National Farmers Union.
Farmers have been upset recently over the use of imported used cooking oil from China being used to make renewable fuels, as opposed to soybean oil produced in the US.
A positive earnings update from Taiwan Semiconductor Manufacturing Co. helped restore sentiment in the tech sector early Thursday; this comes following the downward move this week caused by rhetoric of trade restrictions on China from the Biden admin.
Other equity market happenings on Thursday include a rate decision from the European Central Bank, as well as speeches from a trio of Fed officials. The trade sees the ECB leaving rates unchanged this month, while the Fed comments are some of the last before the July meeting at the end of the month.
US President Joe Biden has paused campaigning for re-election to self-isolate, as he has contracted Covid-19.
Similar to Tuesday, most of yesterday’s rainfall in the US was focused on the South and Southeast, while areas of the central Plains also picked up scattered moisture. Heaviest totals of up to 5″ were seen in small local areas of N AR/S MO, while the broader SE picked up anywhere from 0.1-2″.
Not a lot of forecast updates for Thursday, as the pattern of cool/dry weather for most of the Corn Belt persists. The GFS continues to be wetter in the Dakota’s/MN through the weekend than the EU model, but the two are in otherwise good agreement for the rest of the week.
Week-two forecasts have diverged a bit as well, as the GFS has turned drier in LA/AR/MS/GA while the EU stays wet in these areas. The CPC outlook is more in-line with the EU model than the GFS.
Warm air remains confined to the West and Northwest through the middle of next week, as the Midwest and most of the eastern half of the US will continue to see average to below average temps for the next 7 days.
The EU model remains wetter in areas east of the Black Sea, while the GFS has not pulled this moisture into its solutions. Otherwise, global forecast remains mostly the same from Wednesday.
Have a great day.
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