Good morning.
Ag markets are mostly lower to start the last day of the week. Open interest data this week has shown the spec community doing most of the buying as opposed to funds covering shorts, which means there’s a chance these traders sell these positions back and bank profits going into the weekend. Forty-eight hours can produce significant changes in the forecast, and this is what traders will be watching for to start next week. Mother Nature continues to have the most outsized impact on price discovery. Corn futures this morning are trading 3-4 cents lower, soybean futures are trading 8-9 cents lower, and the Chicago wheat market is down 1-3 cents. Products are lower, soybean meal is $1-3/ton lower, and soybean oil is down 20-30 points. Outside markets are mixed, crude oil futures are down 30-40 cents, the Dow Jones index is up 250 points, and the US$ index is up 5 points. The S&P500 is up 40 points, and the NASDAQ is up 200 points.
Soybean meal closed above the 100-day moving average on Thursday for the first time since the first week of July, as rumors are circulating that Argentine port workers are again planning to strike next week.
The Buenos Aires Grain Exchange, in a weekly report, again left their corn production estimate for Argentina unchanged at 46.5 mmt’s; they see harvest progress at 86.6% complete, up from 79.2% last week.
Same group sees Argentina’s winter wheat seeding nearly completed, as planting progress has reached 98.5%. The Exchange made no updates to their planted area estimate this week, seeing it at 6.3 mil hectares.
According to the European Commission, total grain output from the EU in the 2024/25 season is seen at 271.6 mil tons, down from their June estimate of 274.7 mil tons.
StatsCan showed June canola crush in Canada at 776k tons, which would be up 8.3% from same month last year. Cumulative crush for the marketing year started August 1 has reached 10.028 mil tons, up 11.4% from same period the year prior. Oil production in June totaled 335k tons (+11.6% from last June), and meal production was seen at 447k tons (+6% from last June).
The Wheat Quality Council wrapped up their three-day tour of North Dakota wheat fields on Thursday; the group estimated state yield at 54.5 bu/acre, the highest figure on record going back to 1992. This compares to 47.4 bu/acre estimated last year, and the five-year average estimate of 42 bu/acre.
According to private group FranceAgriMer, French wheat harvest as reached just 41% complete as of July 22nd, compared to 76% on the same date last year. The group says that excessive rainfall continues to limit harvest progress and is worsening crop conditions.
The USDA’s monthly livestock slaughter report showed commercial beef production in June at 2.136 bil lbs., down 8.2% from May and down 8.6% from June of last year. Pork production was seen at 2.118 bil lbs., down 7.1% from May, and down 3.8% from June of last year.
Cattle slaughter for the month totaled 2.541 mil head, which was down 12.3% from June of last year, and was down 7.5% from May. And hog slaughter totaled 9.915 mil head, down 4.9% from last year, and down 6.3% from May.
On the poultry side, slaughter was seen at 5.518 bil lbs., down 7.2% from last year. Cumulative total poultry slaughter for the calendar year was seen at 34.258 mil lbs., down 0.8% from the same period last year.
Barge shipments down the Mississippi River in the week ending July 20th totaled 317k tons, up 14% from last week. Corn shipments at 187k tons were up 4.5% on the week, and soybean shipments at 79k tons were up 14.5% on the week.
As a reminder, today is the last trading day for August options. First notice day on August futures contracts is next Wednesday, July 31st, with the last trading day on those contracts being August 14th.
Equity markets will be squarely focused on today’s PCE inflation data, which is expected to show inflation further creeping towards the Fed’s 2% target; the average trade guess for the report is 2.5% on an annual basis, which would be down 0.1% from last month. Traders are hopeful the data further points to a September rate cut.
As the Olympics are set to kick off today in Paris, arsonists sabotaged trains including the international Eurostar just hours before the opening ceremonies were set to begin. Authorities said the attack aimed to “paralyze the network,” and that nearly 800,000 people would be affected.
Rains across the country Thursday were again focused primarily on the south and southeastern portions of the US; 24-hour satellite data shows another 0.1-2″ generally speaking for areas from E TX to the Carolina’s. Heaviest amounts were seen again in TX, where some areas received closer to 3-4″. Better rains were also noted in the west across AZ and into UT/NV/ID.
72-hour rainfall data shows parts of TX/LA have received upwards of 8-10″ of rainfall this week, while parts of the Carolina’s have seen totals of 4-7″. The broader area looks to have received 3-4″ more generally speaking as of this morning.
Models are in fairly good agreement that active moisture flow from the Gulf keeps these areas wet through this weekend, while parts of the Dakota’s and MN are also expected to see 1-2″ of rainfall through Monday morning. This moisture is critical amid the impending heat that is set to follow it next week. The rest of the Corn Belt is mostly dry.
Not a lot of updates going into the weekend otherwise; week-two guidance was mostly unchanged from yesterday on both moisture as well as the location of the high-pressure ridge. Whether the models see the ridge further south/west by next week will be the main feature traders will have their eyes on over the weekend.
Have a great day.
Grain Comments: 07-26-2024
Good morning.
Ag markets are mostly lower to start the last day of the week. Open interest data this week has shown the spec community doing most of the buying as opposed to funds covering shorts, which means there’s a chance these traders sell these positions back and bank profits going into the weekend. Forty-eight hours can produce significant changes in the forecast, and this is what traders will be watching for to start next week. Mother Nature continues to have the most outsized impact on price discovery. Corn futures this morning are trading 3-4 cents lower, soybean futures are trading 8-9 cents lower, and the Chicago wheat market is down 1-3 cents. Products are lower, soybean meal is $1-3/ton lower, and soybean oil is down 20-30 points. Outside markets are mixed, crude oil futures are down 30-40 cents, the Dow Jones index is up 250 points, and the US$ index is up 5 points. The S&P500 is up 40 points, and the NASDAQ is up 200 points.
Soybean meal closed above the 100-day moving average on Thursday for the first time since the first week of July, as rumors are circulating that Argentine port workers are again planning to strike next week.
The Buenos Aires Grain Exchange, in a weekly report, again left their corn production estimate for Argentina unchanged at 46.5 mmt’s; they see harvest progress at 86.6% complete, up from 79.2% last week.
Same group sees Argentina’s winter wheat seeding nearly completed, as planting progress has reached 98.5%. The Exchange made no updates to their planted area estimate this week, seeing it at 6.3 mil hectares.
According to the European Commission, total grain output from the EU in the 2024/25 season is seen at 271.6 mil tons, down from their June estimate of 274.7 mil tons.
StatsCan showed June canola crush in Canada at 776k tons, which would be up 8.3% from same month last year. Cumulative crush for the marketing year started August 1 has reached 10.028 mil tons, up 11.4% from same period the year prior. Oil production in June totaled 335k tons (+11.6% from last June), and meal production was seen at 447k tons (+6% from last June).
The Wheat Quality Council wrapped up their three-day tour of North Dakota wheat fields on Thursday; the group estimated state yield at 54.5 bu/acre, the highest figure on record going back to 1992. This compares to 47.4 bu/acre estimated last year, and the five-year average estimate of 42 bu/acre.
According to private group FranceAgriMer, French wheat harvest as reached just 41% complete as of July 22nd, compared to 76% on the same date last year. The group says that excessive rainfall continues to limit harvest progress and is worsening crop conditions.
The USDA’s monthly livestock slaughter report showed commercial beef production in June at 2.136 bil lbs., down 8.2% from May and down 8.6% from June of last year. Pork production was seen at 2.118 bil lbs., down 7.1% from May, and down 3.8% from June of last year.
Cattle slaughter for the month totaled 2.541 mil head, which was down 12.3% from June of last year, and was down 7.5% from May. And hog slaughter totaled 9.915 mil head, down 4.9% from last year, and down 6.3% from May.
On the poultry side, slaughter was seen at 5.518 bil lbs., down 7.2% from last year. Cumulative total poultry slaughter for the calendar year was seen at 34.258 mil lbs., down 0.8% from the same period last year.
Barge shipments down the Mississippi River in the week ending July 20th totaled 317k tons, up 14% from last week. Corn shipments at 187k tons were up 4.5% on the week, and soybean shipments at 79k tons were up 14.5% on the week.
As a reminder, today is the last trading day for August options. First notice day on August futures contracts is next Wednesday, July 31st, with the last trading day on those contracts being August 14th.
Equity markets will be squarely focused on today’s PCE inflation data, which is expected to show inflation further creeping towards the Fed’s 2% target; the average trade guess for the report is 2.5% on an annual basis, which would be down 0.1% from last month. Traders are hopeful the data further points to a September rate cut.
As the Olympics are set to kick off today in Paris, arsonists sabotaged trains including the international Eurostar just hours before the opening ceremonies were set to begin. Authorities said the attack aimed to “paralyze the network,” and that nearly 800,000 people would be affected.
Rains across the country Thursday were again focused primarily on the south and southeastern portions of the US; 24-hour satellite data shows another 0.1-2″ generally speaking for areas from E TX to the Carolina’s. Heaviest amounts were seen again in TX, where some areas received closer to 3-4″. Better rains were also noted in the west across AZ and into UT/NV/ID.
72-hour rainfall data shows parts of TX/LA have received upwards of 8-10″ of rainfall this week, while parts of the Carolina’s have seen totals of 4-7″. The broader area looks to have received 3-4″ more generally speaking as of this morning.
Models are in fairly good agreement that active moisture flow from the Gulf keeps these areas wet through this weekend, while parts of the Dakota’s and MN are also expected to see 1-2″ of rainfall through Monday morning. This moisture is critical amid the impending heat that is set to follow it next week. The rest of the Corn Belt is mostly dry.
Not a lot of updates going into the weekend otherwise; week-two guidance was mostly unchanged from yesterday on both moisture as well as the location of the high-pressure ridge. Whether the models see the ridge further south/west by next week will be the main feature traders will have their eyes on over the weekend.
Have a great day.
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