Good morning.
Grain and soy markets are mixed to start the new week, with corn and soybeans higher and the wheat market lower. Weekend rains in the eastern Corn Belt were slightly better than anticipated, which should help to offset coming and heat/dryness that continues to be advertised by the models into the end of August. Aside from weather, which remains factor number one in price determination in the short term, the Pro Farmer crop tour is set to begin today and wrap up by the end of the week; this will be one of the best early looks at whether the USDA’s record yield forecasts are plausible and will be closely watched by both traders and farmers. Corn futures this morning are 1-2 cents higher, soybean futures are 4-5 cents higher, and the Chicago wheat market is down 3-6 cents. Products are mixed, soybean meal is up $3/ton, and soybean oil is down 10 points. Outside markets are mostly lower, crude oil is down 30-40 cents/bbl, the Dow Jones index is unchanged, and the US$ index is down 20 points. The S&P500 and the NASDAQ are both also near unchanged.
Friday afternoon’s CFTC commitment of traders report for the week ending August 13th showed managed money traders were sellers of 6,462 corn contracts, sellers of 5,431 soybean contracts, and sellers of 1,956 Chicago wheat contracts.
This makes the funds now net-short 249,007 contracts of corn, net-short 174,447 contracts of soybeans, and net-short 73,288 contracts of Chicago wheat.
In soy products, funds were sellers of 1,002 contracts of soybean oil, and sellers of 41,231 contracts of soybean meal. This makes them now net-short 80,273 contracts of bean oil, and net-long just 779 contracts of soybean meal. Of note, this was the single biggest week of selling in meal since tracking began in 2006.
According to Ukraine’s Ag Ministry, wheat harvest in the country has been completed with the crop estimated at 21.7 mmt’s. If accurate, this would be just marginally higher than last year’s 21.6 mmt’s.
Staying in Ukraine, private consultancy ASAP Agro sees the coming soybean crop at 5.7 mmt’s, which would be a record, and up from last year’s roughly 5 mmt harvest. The group says despite drought, production forecasts were increased due to a record-large, planted area of 2.63 mil ha’s.
US federally inspected pork production in the week ending August 17th totaled 529 mil lbs., up 5.1% from last week. Beef production was seen at 507 mil lbs., up 2% from last week. YTD pork production is up 1.5% from last year, while beef production is down 1.3%.
There was little progress made on CN/CPKC rail situation mentioned last week. The Teamsters union this morning issued a 72-hour strike notice to CPKC, while the CN issued a lockout notice to the same union for the same time on Thursday this week.
Not a lot of happenings in the equity markets to start the new week, as Monday is expected to be mostly quiet from a data standpoint. The main event for this week will be the central bank’s annual meeting in Jackson Hole, Wyoming, where Fed Chair Jerome Powell is expected to give his latest updates on the US economy.
In US politics, the DNC (Democratic National Convention) is set to kick off in Chicago on Monday. Current US President Joe Biden is expected to headline the proceedings on night one.
Weekend weather offered a bit of a mixed bag, with scattered rains seen in the eastern Corn Belt and a band of showers through SD/NE/KS in the west. Totals in the east ranged from 0.1-3″ generally speaking, with the heaviest totals in the northeast and Great Lakes areas. Western rains were estimated at 0.1-1.5″.
For the week ahead, models are in decent agreement on near complete dryness for the majority of the Corn Belt; the Dakota’s and Nebraska see the best chances at rain through Friday, though the EU is slightly wetter than the GFS. Both models also see rain chances for the four-corner states in the southwest.
Temps this week look to stay well below average in the east through mid-week, with a rebound to more seasonally average temperatures expected by week’s end. High’s stay below 80 degrees F in IL/IN/OH through Thursday.
Models are also in fair agreement on the week-two forecasts coming out of the weekend; both the EU and GFS see below average precipitation chances for nearly the whole of the country, while temps are still seen returning to above average levels by the end of the month.
Have a great day.
Grain Comments: 08-19-2024
Good morning.
Grain and soy markets are mixed to start the new week, with corn and soybeans higher and the wheat market lower. Weekend rains in the eastern Corn Belt were slightly better than anticipated, which should help to offset coming and heat/dryness that continues to be advertised by the models into the end of August. Aside from weather, which remains factor number one in price determination in the short term, the Pro Farmer crop tour is set to begin today and wrap up by the end of the week; this will be one of the best early looks at whether the USDA’s record yield forecasts are plausible and will be closely watched by both traders and farmers. Corn futures this morning are 1-2 cents higher, soybean futures are 4-5 cents higher, and the Chicago wheat market is down 3-6 cents. Products are mixed, soybean meal is up $3/ton, and soybean oil is down 10 points. Outside markets are mostly lower, crude oil is down 30-40 cents/bbl, the Dow Jones index is unchanged, and the US$ index is down 20 points. The S&P500 and the NASDAQ are both also near unchanged.
Friday afternoon’s CFTC commitment of traders report for the week ending August 13th showed managed money traders were sellers of 6,462 corn contracts, sellers of 5,431 soybean contracts, and sellers of 1,956 Chicago wheat contracts.
This makes the funds now net-short 249,007 contracts of corn, net-short 174,447 contracts of soybeans, and net-short 73,288 contracts of Chicago wheat.
In soy products, funds were sellers of 1,002 contracts of soybean oil, and sellers of 41,231 contracts of soybean meal. This makes them now net-short 80,273 contracts of bean oil, and net-long just 779 contracts of soybean meal. Of note, this was the single biggest week of selling in meal since tracking began in 2006.
According to Ukraine’s Ag Ministry, wheat harvest in the country has been completed with the crop estimated at 21.7 mmt’s. If accurate, this would be just marginally higher than last year’s 21.6 mmt’s.
Staying in Ukraine, private consultancy ASAP Agro sees the coming soybean crop at 5.7 mmt’s, which would be a record, and up from last year’s roughly 5 mmt harvest. The group says despite drought, production forecasts were increased due to a record-large, planted area of 2.63 mil ha’s.
US federally inspected pork production in the week ending August 17th totaled 529 mil lbs., up 5.1% from last week. Beef production was seen at 507 mil lbs., up 2% from last week. YTD pork production is up 1.5% from last year, while beef production is down 1.3%.
There was little progress made on CN/CPKC rail situation mentioned last week. The Teamsters union this morning issued a 72-hour strike notice to CPKC, while the CN issued a lockout notice to the same union for the same time on Thursday this week.
Not a lot of happenings in the equity markets to start the new week, as Monday is expected to be mostly quiet from a data standpoint. The main event for this week will be the central bank’s annual meeting in Jackson Hole, Wyoming, where Fed Chair Jerome Powell is expected to give his latest updates on the US economy.
In US politics, the DNC (Democratic National Convention) is set to kick off in Chicago on Monday. Current US President Joe Biden is expected to headline the proceedings on night one.
Weekend weather offered a bit of a mixed bag, with scattered rains seen in the eastern Corn Belt and a band of showers through SD/NE/KS in the west. Totals in the east ranged from 0.1-3″ generally speaking, with the heaviest totals in the northeast and Great Lakes areas. Western rains were estimated at 0.1-1.5″.
For the week ahead, models are in decent agreement on near complete dryness for the majority of the Corn Belt; the Dakota’s and Nebraska see the best chances at rain through Friday, though the EU is slightly wetter than the GFS. Both models also see rain chances for the four-corner states in the southwest.
Temps this week look to stay well below average in the east through mid-week, with a rebound to more seasonally average temperatures expected by week’s end. High’s stay below 80 degrees F in IL/IN/OH through Thursday.
Models are also in fair agreement on the week-two forecasts coming out of the weekend; both the EU and GFS see below average precipitation chances for nearly the whole of the country, while temps are still seen returning to above average levels by the end of the month.
Have a great day.
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