Good morning.
Small turn-around Wednesday so far in the overnight markets, as soybean futures are higher while corn and Chicago wheat futures consolidate near unchanged. Momentum in the markets continues to trend lower, but RSI is again reaching severely oversold levels on the September corn and bean charts, which means we should be due for at least some type of minor bounce ahead of harvest. Traders have little faith in any US Midwest forecast beyond 5 days, which has produced choppy trade in the past few sessions. Whether or not there is yield reduction due to heat/dryness in the western Corn Belt is the market’s main focus today. Corn futures this morning are unchanged to a penny higher, soybean futures are up 8-10 cents, and the Chicago wheat market is also unchanged to a penny higher. Products are higher, soybean meal is up $2.50-3.50/ton, and soybean oil is up 20-40 points. Outside markets are sharply mixed, crude oil futures are trading $2.30-2.60/bbl higher, the Dow Jones index is up 50 points, and the US$ index is down 50 points. The S&P500 is up 50 points and the NASDAQ is up 320 points.
This morning’s weekly ethanol production report for the week ending July 26th is expected to show production in a range of 1.080-1.090 mil bbls, while stocks are seen between 23.200-24.000 mil bbls.
The USDA is scheduled to release its monthly fats & oils report, as well as the monthly grain crushing report, tomorrow afternoon at 2pm central time. The reports are expected to show soybean crush for the month of June at 184.8 mil bu’s (174.6 mil last year), and corn grind for ethanol at 450 mil bu (442.1 mil last year).
Stocks of soybean oil are estimated at 2.076 bil lbs as of the end of June, which would be down from the 2.203 bil lbs seen last year.
According to the European Commission, soft wheat exports out of the EU in the season that began July 1 totaled 1.85 mmt’s, which is down nearly 38% from the same period last year. Barely exports are down 39% in the same period, while corn imports are up a similar 31%.
Ukraine’s Ag Minister says grain exports as of July 1 have reached 3.4 mmt’s, which is well above the 2.2 mmt’s exported in the same period last year. Data showed as of Wednesday the country had exported 1.44 mmt’s of wheat, 1.51 mmt’s of corn, and 477k mt’s of barley.
China on Wednesday announced an additional 2 bil yuan ($277 mil) in disaster relief funding meant to ensure ag production. Corn, soybean and rice growers are said to the main beneficiaries, while the funds will be available in more than a dozen regions.
WTI crude oil futures are trading sharply higher this morning following yesterday’s claim by Israel on the weekend missile attack in Lebanon that killed a senior Hamas commander. Risk of broader war continues to boil in a region that produces roughly a third of the world’s oil.
Stock index futures have also had a good start to the last trading day in July despite disappointing earnings from Microsoft overnight. The tech sector received a boost from rumors that the US would be excluding the semiconductor-equipment makers of some countries including the Netherlands, South Korea, and Japan from trade restrictions.
Equity markets are also anticipating Fed Chairman Jerome Powell laying out a plan for a September rate cut following the conclusion of yesterday and today’s FOMC meeting.
This comes as the Bank of Japan this morning surprisingly raised its policy rate by 0.25%.
Traders are attributing most of the weakness in the US$ index this morning to the BoJ news, as the yen strengthened more than 1.5% against the dollar.
24-hour satellite data this morning again shows good rains for areas of southeast IA, southern IL, and KY/TN on Tuesday. Heaviest totals of 2-4″ were seen in SE IA, while other areas received a more general 0.25-1.5″. Areas of PA and NY also saw beneficial rains.
Forecasts continue to trend less threatening beyond next week, as new 8-14 day guidance out yesterday from the CPC shows an above average chance at precip for almost the whole of the country from August 7-13. Temps in this time period are also seen average to slightly below average for the northern and central part of the Corn Belt, while the south and west are seen staying hot.
Week-two ensembles from the GFS and EU models also shifted moisture in the second week of August farther south, with now almost the entire Corn Belt seeing average to above average precipitation chances.
Short-term, not a lot of updates from yesterday to today. Temps stay hot the rest of this week and the first part of next week with highs continuing to regularly touch triple digits in the central part of the country. Western heat again expands east at the end of the week, before a trough of low pressure brings more mild air from the north starting August 5/6/7.
Precipitation the rest of this week continues to favor areas of MN, IA, WI, IL, IN, OH, and KY, which are on the benefiting end of ridge-riding storms that are popping due to northwest flow over the top of the ridge interacting with an active moisture flow coming from the Gulf.
Have a great day
Grain Comments: 07-31-2024
Good morning.
Small turn-around Wednesday so far in the overnight markets, as soybean futures are higher while corn and Chicago wheat futures consolidate near unchanged. Momentum in the markets continues to trend lower, but RSI is again reaching severely oversold levels on the September corn and bean charts, which means we should be due for at least some type of minor bounce ahead of harvest. Traders have little faith in any US Midwest forecast beyond 5 days, which has produced choppy trade in the past few sessions. Whether or not there is yield reduction due to heat/dryness in the western Corn Belt is the market’s main focus today. Corn futures this morning are unchanged to a penny higher, soybean futures are up 8-10 cents, and the Chicago wheat market is also unchanged to a penny higher. Products are higher, soybean meal is up $2.50-3.50/ton, and soybean oil is up 20-40 points. Outside markets are sharply mixed, crude oil futures are trading $2.30-2.60/bbl higher, the Dow Jones index is up 50 points, and the US$ index is down 50 points. The S&P500 is up 50 points and the NASDAQ is up 320 points.
This morning’s weekly ethanol production report for the week ending July 26th is expected to show production in a range of 1.080-1.090 mil bbls, while stocks are seen between 23.200-24.000 mil bbls.
The USDA is scheduled to release its monthly fats & oils report, as well as the monthly grain crushing report, tomorrow afternoon at 2pm central time. The reports are expected to show soybean crush for the month of June at 184.8 mil bu’s (174.6 mil last year), and corn grind for ethanol at 450 mil bu (442.1 mil last year).
Stocks of soybean oil are estimated at 2.076 bil lbs as of the end of June, which would be down from the 2.203 bil lbs seen last year.
According to the European Commission, soft wheat exports out of the EU in the season that began July 1 totaled 1.85 mmt’s, which is down nearly 38% from the same period last year. Barely exports are down 39% in the same period, while corn imports are up a similar 31%.
Ukraine’s Ag Minister says grain exports as of July 1 have reached 3.4 mmt’s, which is well above the 2.2 mmt’s exported in the same period last year. Data showed as of Wednesday the country had exported 1.44 mmt’s of wheat, 1.51 mmt’s of corn, and 477k mt’s of barley.
China on Wednesday announced an additional 2 bil yuan ($277 mil) in disaster relief funding meant to ensure ag production. Corn, soybean and rice growers are said to the main beneficiaries, while the funds will be available in more than a dozen regions.
WTI crude oil futures are trading sharply higher this morning following yesterday’s claim by Israel on the weekend missile attack in Lebanon that killed a senior Hamas commander. Risk of broader war continues to boil in a region that produces roughly a third of the world’s oil.
Stock index futures have also had a good start to the last trading day in July despite disappointing earnings from Microsoft overnight. The tech sector received a boost from rumors that the US would be excluding the semiconductor-equipment makers of some countries including the Netherlands, South Korea, and Japan from trade restrictions.
Equity markets are also anticipating Fed Chairman Jerome Powell laying out a plan for a September rate cut following the conclusion of yesterday and today’s FOMC meeting.
This comes as the Bank of Japan this morning surprisingly raised its policy rate by 0.25%.
Traders are attributing most of the weakness in the US$ index this morning to the BoJ news, as the yen strengthened more than 1.5% against the dollar.
24-hour satellite data this morning again shows good rains for areas of southeast IA, southern IL, and KY/TN on Tuesday. Heaviest totals of 2-4″ were seen in SE IA, while other areas received a more general 0.25-1.5″. Areas of PA and NY also saw beneficial rains.
Forecasts continue to trend less threatening beyond next week, as new 8-14 day guidance out yesterday from the CPC shows an above average chance at precip for almost the whole of the country from August 7-13. Temps in this time period are also seen average to slightly below average for the northern and central part of the Corn Belt, while the south and west are seen staying hot.
Week-two ensembles from the GFS and EU models also shifted moisture in the second week of August farther south, with now almost the entire Corn Belt seeing average to above average precipitation chances.
Short-term, not a lot of updates from yesterday to today. Temps stay hot the rest of this week and the first part of next week with highs continuing to regularly touch triple digits in the central part of the country. Western heat again expands east at the end of the week, before a trough of low pressure brings more mild air from the north starting August 5/6/7.
Precipitation the rest of this week continues to favor areas of MN, IA, WI, IL, IN, OH, and KY, which are on the benefiting end of ridge-riding storms that are popping due to northwest flow over the top of the ridge interacting with an active moisture flow coming from the Gulf.
Have a great day
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