Good morning.
Ag markets are lower in light volume ahead of this morning’s August WASDE report, which is due out at 11am central time. Traders are leaning decidedly bearish ahead of the numbers, which likely increases the odds we get volatile trade following the data’s release. Otherwise, weekly crop progress will be out later this afternoon and we are another week closer to combines starting to roll. Weather forecasts are not perfect but are also not extremely threatening. Remember, this is August in the Midwest and temperatures do tend to get warm again before Fall arrives. Corn futures this morning are 1-2 cents lower, soybean futures are 7-8 cents lower, and the Chicago wheat market is down 8-9 cents. Products are mixed, soybean meal is up $1-2/ton, and soybean oil is down 50-60 points. Outside markets are also mixed, crude oil futures are up 80-90 cents/bbl higher, the Dow Jones index is up 50 points, and the US$ index is up 5 points.
Friday afternoon’s CFTC commitment of trader’s update showed fund traders continued to cover shorts in the corn market, while also being net buyer in soybeans and Chicago wheat futures.
For the week ending August 6th, managed money traders were buyers of a combined 52,551 contracts of corn futures/options, buyers of 9,575 combined contracts of soybean futures/options, and buyers of a combined 6,283 contracts of Chicago wheat futures/options.
This makes the funds now net-short 242,545 contracts of corn, net-short 169,016 contracts of soybeans, and net-short 71,332 contracts of Chicago wheat.
In soy products, funds were sellers of 19,682 contracts of soybean oil, and were buyers of 10,279 contracts of soybean meal. This makes them now net-short 79,269 contracts of bean oil, and net-long 42,009 contracts of bean meal.
The monthly China Agricultural Supply and Demand Estimates report, released on Monday, showed Chinese soybean imports in the 2023/24 season at 98.37 mmt’s, which is up 2.27 mmt’s from last month’s estimate.
The report also showed Chinese soybean crush increasing by 0.4% to 96.15 mmt’s. Of note, production estimates for corn and soybeans remain unchanged despite severe weather impacting a majority of the country’s main growing areas.
The oilseed worker striker in Argentina is expected to continue for a seventh day to start this week, as negotiations with firms remain stalled over the weekend according to sources. As of Sunday, at least three-dozen ships were still delayed near the port of Rosario.
US federally inspected pork production in the week ending August 10th was down 3.5% from the week prior at 501 mil lbs.; beef production was down 0.4% at 497 mil lbs. For the year, pork production is up 1.4% from last year, and beef production is down 1.4%.
Equity markets look to see a mostly quiet start to the week, ahead of important inflation data due out on Tuesday and Wednesday. Traders expect CPI increased modestly in June, but still see a rate cut in September as more-than-likely.
On the US political front, Elon Musk is set to interview Donald Trump live on his X platform (formerly Twitter) at 7pm central time this evening. There will be “no limits on subject matter” according to sources.
Weekend weather was mostly dry across the Midwest, with rains from the Plains creeping into the far Western areas of IA/MO. Totals of 0.1-1″ were scattered through the Plains and central part of the country, with the heaviest local totals of up to 8″ seen in parts of OK. The northeast and east coast also picked up additional moisture from Debby.
For this week, models are in decent agreement on a return to a wetter bias for most of the Corn Belt by the end of the week. Totals of 0.75-3″ from thunderstorm activity are seen from S MO to N MN and from C NE to E IL.
Temps look to remain cool for another day or two, before a return to more average levels is seen by week’s end. Heat remains confined mostly to the south and southwest, as highs in the Corn Belt top out in NE/IA in the mid/upper 80’s.
Week-two forecasts continue to trend slightly warmer and drier, continuing with last week’s general theme. Neither the temp nor precipitation outlook is extremely threatening as it stands today, but farmers will be watching for any updates to a hotter outlook into the end of August.
Good luck with today’s USDA report. Surprises likely come via acreage adjustments, as USDA is set to incorporate farm program data from the FSA and RMA.
Have a great day.
Grain Comments: 08-12-2024
Good morning.
Ag markets are lower in light volume ahead of this morning’s August WASDE report, which is due out at 11am central time. Traders are leaning decidedly bearish ahead of the numbers, which likely increases the odds we get volatile trade following the data’s release. Otherwise, weekly crop progress will be out later this afternoon and we are another week closer to combines starting to roll. Weather forecasts are not perfect but are also not extremely threatening. Remember, this is August in the Midwest and temperatures do tend to get warm again before Fall arrives. Corn futures this morning are 1-2 cents lower, soybean futures are 7-8 cents lower, and the Chicago wheat market is down 8-9 cents. Products are mixed, soybean meal is up $1-2/ton, and soybean oil is down 50-60 points. Outside markets are also mixed, crude oil futures are up 80-90 cents/bbl higher, the Dow Jones index is up 50 points, and the US$ index is up 5 points.
Friday afternoon’s CFTC commitment of trader’s update showed fund traders continued to cover shorts in the corn market, while also being net buyer in soybeans and Chicago wheat futures.
For the week ending August 6th, managed money traders were buyers of a combined 52,551 contracts of corn futures/options, buyers of 9,575 combined contracts of soybean futures/options, and buyers of a combined 6,283 contracts of Chicago wheat futures/options.
This makes the funds now net-short 242,545 contracts of corn, net-short 169,016 contracts of soybeans, and net-short 71,332 contracts of Chicago wheat.
In soy products, funds were sellers of 19,682 contracts of soybean oil, and were buyers of 10,279 contracts of soybean meal. This makes them now net-short 79,269 contracts of bean oil, and net-long 42,009 contracts of bean meal.
The monthly China Agricultural Supply and Demand Estimates report, released on Monday, showed Chinese soybean imports in the 2023/24 season at 98.37 mmt’s, which is up 2.27 mmt’s from last month’s estimate.
The report also showed Chinese soybean crush increasing by 0.4% to 96.15 mmt’s. Of note, production estimates for corn and soybeans remain unchanged despite severe weather impacting a majority of the country’s main growing areas.
The oilseed worker striker in Argentina is expected to continue for a seventh day to start this week, as negotiations with firms remain stalled over the weekend according to sources. As of Sunday, at least three-dozen ships were still delayed near the port of Rosario.
US federally inspected pork production in the week ending August 10th was down 3.5% from the week prior at 501 mil lbs.; beef production was down 0.4% at 497 mil lbs. For the year, pork production is up 1.4% from last year, and beef production is down 1.4%.
Equity markets look to see a mostly quiet start to the week, ahead of important inflation data due out on Tuesday and Wednesday. Traders expect CPI increased modestly in June, but still see a rate cut in September as more-than-likely.
On the US political front, Elon Musk is set to interview Donald Trump live on his X platform (formerly Twitter) at 7pm central time this evening. There will be “no limits on subject matter” according to sources.
Weekend weather was mostly dry across the Midwest, with rains from the Plains creeping into the far Western areas of IA/MO. Totals of 0.1-1″ were scattered through the Plains and central part of the country, with the heaviest local totals of up to 8″ seen in parts of OK. The northeast and east coast also picked up additional moisture from Debby.
For this week, models are in decent agreement on a return to a wetter bias for most of the Corn Belt by the end of the week. Totals of 0.75-3″ from thunderstorm activity are seen from S MO to N MN and from C NE to E IL.
Temps look to remain cool for another day or two, before a return to more average levels is seen by week’s end. Heat remains confined mostly to the south and southwest, as highs in the Corn Belt top out in NE/IA in the mid/upper 80’s.
Week-two forecasts continue to trend slightly warmer and drier, continuing with last week’s general theme. Neither the temp nor precipitation outlook is extremely threatening as it stands today, but farmers will be watching for any updates to a hotter outlook into the end of August.
Good luck with today’s USDA report. Surprises likely come via acreage adjustments, as USDA is set to incorporate farm program data from the FSA and RMA.
Have a great day.
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