Good morning.
Commodity markets had a relatively uneventful overnight trade Wednesday night for the first time this week, which has left ag markets lightly mixed to start Thursday. Trade today likely continues to be choppy ahead of Monday’s WASDE report, with position squaring being the main feature. In the cash markets, basis has been weakening this week on the last little bit of old crop ‘give up’ selling. With harvest around the corner, the US farmer has reached the end of the line on the 2023/24 crop and is clearing bin space for new bushels. Corn futures this morning are trading around a penny lower, soybean futures are down 1-2 cents, and the Chicago wheat market is up 2-3 cents. Products are mixed, soybean meal is up around $1/ton, and soybean oil is down 10-20 points. Outside markets are mostly lower, crude oil futures are down 10-20 cents/bbl, the Dow Jones index is down 80 points, and the US$ index is down 10 points. Both the S&P500 and the NASDAQ are near unchanged.
This morning’s weekly export sales report for the week ending August 1st is expected to show old crop corn sales in a range of 100k-400k mt’s, and old crop soybean sales in a range of 100k-300k mt’s.
New crop corn sales for the week are estimated between 475k-1 mil mt’s, new crop soybean sales are estimated between 400k-900k mt’s, and new crop wheat sales are estimated between 250k-500k mt’s.
Data from Brazil’s Trade Ministry shows soybean exports to China were up nearly 31% from last year in the month of July at 8.921 mmt’s. Cumulative exports to China in the calendar year so far were seen at 55.237 mmt’s, which is up almost 10% from last year.
Strategie Grains, a European ag firm, lowered its production estimate for the EU wheat crop to 116.5 mmt’s, down roughly 5% from last month’s estimate. The group says continued reductions to the French crop was the main reason for the cut.
The labor strike launched by Argentine oilseed industry workers reached day two yesterday, and according to the head of one of the union’s involved, could extend longer if no progress is made.
Weekly jobs data due this morning will be the main feature in the equity markets today following last week’s poor payrolls number. Stock index futures have been quiet in overnight trade so far.
JP Morgan now sees a 35% chance the US enters recession by the end of the year due to “sharper-than-expected weakening in labor demand and early signs of labor shedding.” This is up from a 25% chance at the beginning of July. The group also sees the odds of a recession by H2 2025 at 45%.
Same group also said they estimate nearly three-fourths of the world’s carry trade has been wiped out in recent days, as investors covered positions that had been on for years.
Rainfall on Wednesday across the country was rather similar to Tuesday; Debby continues to provide moisture to the southeast and East Coast, while areas of KS/NE, as well as parts of MN, picked up rains of 0.1-2″ generally speaking.
Cool air makes its way all the way to the southern part of Kansas today, with high’s here not reaching 80 degrees F. This cooler pattern is seen staying in place through the middle of next week, before temps return to more seasonal levels for most of the Midwest.
Models are in better agreement on precipitation through the end of the week and weekend than was seen yesterday, as the EU has removed rains in the Dakota’s/MT and is more like the GFS model now.
Through Sunday night, both models see up to 4″ of rainfall for parts of KS/OK, while the northern Plains into SD and MT see a more general 0.5-1.5″.
Week two forecasts continue to trend warmer/drier, but the presence of a tropical system in the Atlantic in this time period makes confidence in these forecasts low. It does seem though that there is a good chance the last half of August returns to warmer temps.
Have a great day.
Grain Comments: 08-08-2024
Good morning.
Commodity markets had a relatively uneventful overnight trade Wednesday night for the first time this week, which has left ag markets lightly mixed to start Thursday. Trade today likely continues to be choppy ahead of Monday’s WASDE report, with position squaring being the main feature. In the cash markets, basis has been weakening this week on the last little bit of old crop ‘give up’ selling. With harvest around the corner, the US farmer has reached the end of the line on the 2023/24 crop and is clearing bin space for new bushels. Corn futures this morning are trading around a penny lower, soybean futures are down 1-2 cents, and the Chicago wheat market is up 2-3 cents. Products are mixed, soybean meal is up around $1/ton, and soybean oil is down 10-20 points. Outside markets are mostly lower, crude oil futures are down 10-20 cents/bbl, the Dow Jones index is down 80 points, and the US$ index is down 10 points. Both the S&P500 and the NASDAQ are near unchanged.
This morning’s weekly export sales report for the week ending August 1st is expected to show old crop corn sales in a range of 100k-400k mt’s, and old crop soybean sales in a range of 100k-300k mt’s.
New crop corn sales for the week are estimated between 475k-1 mil mt’s, new crop soybean sales are estimated between 400k-900k mt’s, and new crop wheat sales are estimated between 250k-500k mt’s.
Data from Brazil’s Trade Ministry shows soybean exports to China were up nearly 31% from last year in the month of July at 8.921 mmt’s. Cumulative exports to China in the calendar year so far were seen at 55.237 mmt’s, which is up almost 10% from last year.
Strategie Grains, a European ag firm, lowered its production estimate for the EU wheat crop to 116.5 mmt’s, down roughly 5% from last month’s estimate. The group says continued reductions to the French crop was the main reason for the cut.
The labor strike launched by Argentine oilseed industry workers reached day two yesterday, and according to the head of one of the union’s involved, could extend longer if no progress is made.
Weekly jobs data due this morning will be the main feature in the equity markets today following last week’s poor payrolls number. Stock index futures have been quiet in overnight trade so far.
JP Morgan now sees a 35% chance the US enters recession by the end of the year due to “sharper-than-expected weakening in labor demand and early signs of labor shedding.” This is up from a 25% chance at the beginning of July. The group also sees the odds of a recession by H2 2025 at 45%.
Same group also said they estimate nearly three-fourths of the world’s carry trade has been wiped out in recent days, as investors covered positions that had been on for years.
Rainfall on Wednesday across the country was rather similar to Tuesday; Debby continues to provide moisture to the southeast and East Coast, while areas of KS/NE, as well as parts of MN, picked up rains of 0.1-2″ generally speaking.
Cool air makes its way all the way to the southern part of Kansas today, with high’s here not reaching 80 degrees F. This cooler pattern is seen staying in place through the middle of next week, before temps return to more seasonal levels for most of the Midwest.
Models are in better agreement on precipitation through the end of the week and weekend than was seen yesterday, as the EU has removed rains in the Dakota’s/MT and is more like the GFS model now.
Through Sunday night, both models see up to 4″ of rainfall for parts of KS/OK, while the northern Plains into SD and MT see a more general 0.5-1.5″.
Week two forecasts continue to trend warmer/drier, but the presence of a tropical system in the Atlantic in this time period makes confidence in these forecasts low. It does seem though that there is a good chance the last half of August returns to warmer temps.
Have a great day.
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