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Grain Comments: 08.15.23

Futures are weaker this morning, with corn, soybeans, and wheat all trading in the red. Dollar index down slightly. Energies continue their downward move, and equalities are down with the three three major stock indexes trading 0.6% lower.

 

Today’s Reports: Business Inventories, Retail Sales, NOPA Crush, API Energy Stocks

 

  • Crop conditions show improvement
  • Home Depot reports earnings today, Target tomorrow, Walmart Thursday in a glimpse of the health of the US consumer

 

Crop conditions improved once again last week according to the data in USDA’s Crop Progress report yesterday. Soybean conditions improved an impressive five percentage points week-over-week. The sharp improvement lends support to the idea the soybean yield projections by USDA could improve in coming WASDE reports. Weather turn hot towards the end of August, but overall the weather is non-threatening and should promote good soybean development in the all-important month of August. Further adding to the weak tenor of the market this morning is more disappointing economic news coming out of China. Industrial production grew 3.7% in July which was lower than analyst estimates. The Chinese economy has struggled as of late prompting the Chinese central bank to unexpectedly cut rates again to aid the deflating economy.

 

 

Highlights

* Vessel line up in Brazil growing

* Chinese Industrial Production grew 3.7% in July – less than expected

* Crude oil and US equities lower on the China news on Chinese recession worries

* China cuts rates for the second time in three months

* Japan Q2 GDP rose 6% – double expectations

* Russian ruble weak prompting sudden meeting for Russian Central bank

* Exchange rate briefly touched 102 ruble to dollar

* US ratings agency Fitch warns it may downgrade the credit of many US banks

 

Corn

* Corn crop rated 59% good/excellent – an increase of two percentage points

* Export inspections yesterday in-line with expectations at 15.68 mil bu

* New crop US Exports are projected at 2.05 bil bu – 26% more than 2022/23

* Dec23 corn looks to test new lows for the move

 

Soybeans

* Soybean crop rated 59% good/excellent – an increase of five percentage points

* Export inspections yesterday in-line with expectations at 10.94 mil bu

* 416k mt new crop soybean sale to unknown destination reported yesterday

* New crop US exports projected at 1.825 bil bu – 8% below 2022/2023

* Fundamentals remain supportive

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