Good morning.
Turn-around-Wednesday in the soy complex, while the grains are trading either side of unchanged to start out today. US crop conditions continue to run on the high end of recent history, though we assume with the trade’s perception of the current crop size being what it is, steady crop conditions on Monday (or Tuesday) afternoons likely does little to add to bearishness. New on the bearish front, however, are fears that China would take similar measures to the ones announced on Canadian canola yesterday on US soybeans. On top of already bearish global supply fundamentals, a new negative demand development would not be good for flat price. Corn futures this morning are trading either side of unchanged, soybean futures are down 5-6 cents, and the Chicago wheat market is up 3-4 cents. Products are mixed, soybean meal is down $2-3/ton, and soybean oil is up 10-20 points. Outside markets are mixed, crude oil futures are up 50-60 cents/bbl, the Dow Jones index is down 75 points, and the US$ index is down 10 points. The S&P500 is down 25 points, and the NASDAQ is down 125 points.
Yesterday afternoon’s crop progress report showed as of Sunday, September 1st, 65% of the corn crop was rated g/ex, unchanged on the week; report also showed 65% of the soybean crop rated g/ex, which was down 2% on the week.
Though corn conditions were unchanged as a nation, the state level saw more states decline than improve; biggest declines were seen in Ohio (-7%), Tennessee (-5%), North Dakota (-5%), and South Dakota (-4%). Improvements were noted in Pennsylvania (+10%), Kansas (+3%), and Minnesota (+3%).
Bit of an inverse situation in soybeans as national ratings declined but more states showed improvement than degradation; biggest improvements were seen in Louisiana (+6%), Illinois (+4%), and Minnesota (+3%). Biggest declines were seen in Tennessee (-9%), South Dakota (-6%), North Dakota (-5%), and Nebraska (-4%).
90% of the corn crop has reached the dough stage which matches the five-year average; 60% of the crop was seen dented this week, which is 2% ahead of the five-year average; and 19% of the crop was seen mature, which is 6% ahead of the five-year average.
94% of the soybean crop is setting pods compared to the five-year average of 93%; and 13% of the crop is dropping leaves, compared to the five-year average of 10%.
For wheat, spring wheat harvest advanced 19% from last week to 70% complete, which matches the five-year average. Winter wheat planting was seen at 2% complete this week in the first reading of the season, which also matches the five-year average.
The USDA’s fats and oils report for July, released after the close yesterday, showed soybean crush in the month at 193 mil bu’s, which was up 5.3% from June and up 4.7% compared to July of last year. Soybean oil stocks totaled 2.009 bil lbs., which is down 5.5% from June and down 6% from July of last year.
USDA also released July grain crushing report, which showed total corn use in the month at 527 mil bu’s; this was up 6% from June and up 4% from July of 2023. Corn used for ethanol was similarly up 6.1% from last month and up 4% from last year at 473.504 mil bu’s.
According to data from the European Commission, soft wheat exports out of the EU from July 1 – Sep 1 totaled 4.38 mil tons, which is down from 5.66 mil tons in the same period last year.
Palm oil reserves in Malaysia likely rose 7.5% in the month of August to their highest level since February according to a Bloomberg survey. Production is seen increasing roughly 3.3% on the month, while exports are estimated to have fallen nearly 11%. The Malaysian Palm Oil Board will release official data on September 10th.
This morning’s JOLTs jobs survey will be the main feature in the equity markets on Wednesday, with traders expecting the report to show further cooling in the labor market. The data kicks off a string of job market reports over the next few days, with weekly jobs data due tomorrow and non-farm payrolls for August on Friday.
Nvidia is back in the news this morning, though not for good reasons; the US Justice Department sent subpoenas to it and several other companies as it seeks evidence of violations of antitrust laws. Officials have accused Nvidia of penalizing buyers who don’t exclusively use its chips.
Mostly dry conditions were seen across the Corn Belt on Tuesday, with rains limited mostly to Texas and other areas in the South according to satellite data. This pattern looks to remain for the rest of this week and into the weekend, with the models in fair agreement.
The EU model sees slightly better chances for moisture in the northern part of the country around the Great Lakes States than the GFS does through Sunday, but this is the main difference in the two.
Similar pattern is advertised in the week two forecasts also, with models in good agreement on continued dry weather for most of the mid-section of the country. Not a lot of temp updates overnight in the intermediate term either, with the west expected to stay generally hot and the east expected to stay cooler into September 17th.
Highs today and tomorrow reach back into the mid/upper 80’s for parts of the Corn Belt, but quickly drop back into the 70’s by Friday, and actually top out in the upper 60’s in many places on Saturday.
On the global weather front, data from China’s National Climate Center showed average summer temps in the country this year were the highest since records began being kept in 1961. Data also showed rainfall from June 1 to August 31 at the highest level ever recorded, which caused flooding and landslides.
Still not a lot of change in the forecast for South America; Brazil remains nearly completely dry, while temps are seen some 4-8 degrees C above average over the next 10 days. And Argentina also sees a warmer pattern developing, with rains today seen favoring areas in the south.
Have a great day.
Grain Comments: 09-04-2024
Good morning.
Turn-around-Wednesday in the soy complex, while the grains are trading either side of unchanged to start out today. US crop conditions continue to run on the high end of recent history, though we assume with the trade’s perception of the current crop size being what it is, steady crop conditions on Monday (or Tuesday) afternoons likely does little to add to bearishness. New on the bearish front, however, are fears that China would take similar measures to the ones announced on Canadian canola yesterday on US soybeans. On top of already bearish global supply fundamentals, a new negative demand development would not be good for flat price. Corn futures this morning are trading either side of unchanged, soybean futures are down 5-6 cents, and the Chicago wheat market is up 3-4 cents. Products are mixed, soybean meal is down $2-3/ton, and soybean oil is up 10-20 points. Outside markets are mixed, crude oil futures are up 50-60 cents/bbl, the Dow Jones index is down 75 points, and the US$ index is down 10 points. The S&P500 is down 25 points, and the NASDAQ is down 125 points.
Yesterday afternoon’s crop progress report showed as of Sunday, September 1st, 65% of the corn crop was rated g/ex, unchanged on the week; report also showed 65% of the soybean crop rated g/ex, which was down 2% on the week.
Though corn conditions were unchanged as a nation, the state level saw more states decline than improve; biggest declines were seen in Ohio (-7%), Tennessee (-5%), North Dakota (-5%), and South Dakota (-4%). Improvements were noted in Pennsylvania (+10%), Kansas (+3%), and Minnesota (+3%).
Bit of an inverse situation in soybeans as national ratings declined but more states showed improvement than degradation; biggest improvements were seen in Louisiana (+6%), Illinois (+4%), and Minnesota (+3%). Biggest declines were seen in Tennessee (-9%), South Dakota (-6%), North Dakota (-5%), and Nebraska (-4%).
90% of the corn crop has reached the dough stage which matches the five-year average; 60% of the crop was seen dented this week, which is 2% ahead of the five-year average; and 19% of the crop was seen mature, which is 6% ahead of the five-year average.
94% of the soybean crop is setting pods compared to the five-year average of 93%; and 13% of the crop is dropping leaves, compared to the five-year average of 10%.
For wheat, spring wheat harvest advanced 19% from last week to 70% complete, which matches the five-year average. Winter wheat planting was seen at 2% complete this week in the first reading of the season, which also matches the five-year average.
The USDA’s fats and oils report for July, released after the close yesterday, showed soybean crush in the month at 193 mil bu’s, which was up 5.3% from June and up 4.7% compared to July of last year. Soybean oil stocks totaled 2.009 bil lbs., which is down 5.5% from June and down 6% from July of last year.
USDA also released July grain crushing report, which showed total corn use in the month at 527 mil bu’s; this was up 6% from June and up 4% from July of 2023. Corn used for ethanol was similarly up 6.1% from last month and up 4% from last year at 473.504 mil bu’s.
According to data from the European Commission, soft wheat exports out of the EU from July 1 – Sep 1 totaled 4.38 mil tons, which is down from 5.66 mil tons in the same period last year.
Palm oil reserves in Malaysia likely rose 7.5% in the month of August to their highest level since February according to a Bloomberg survey. Production is seen increasing roughly 3.3% on the month, while exports are estimated to have fallen nearly 11%. The Malaysian Palm Oil Board will release official data on September 10th.
This morning’s JOLTs jobs survey will be the main feature in the equity markets on Wednesday, with traders expecting the report to show further cooling in the labor market. The data kicks off a string of job market reports over the next few days, with weekly jobs data due tomorrow and non-farm payrolls for August on Friday.
Nvidia is back in the news this morning, though not for good reasons; the US Justice Department sent subpoenas to it and several other companies as it seeks evidence of violations of antitrust laws. Officials have accused Nvidia of penalizing buyers who don’t exclusively use its chips.
Mostly dry conditions were seen across the Corn Belt on Tuesday, with rains limited mostly to Texas and other areas in the South according to satellite data. This pattern looks to remain for the rest of this week and into the weekend, with the models in fair agreement.
The EU model sees slightly better chances for moisture in the northern part of the country around the Great Lakes States than the GFS does through Sunday, but this is the main difference in the two.
Similar pattern is advertised in the week two forecasts also, with models in good agreement on continued dry weather for most of the mid-section of the country. Not a lot of temp updates overnight in the intermediate term either, with the west expected to stay generally hot and the east expected to stay cooler into September 17th.
Highs today and tomorrow reach back into the mid/upper 80’s for parts of the Corn Belt, but quickly drop back into the 70’s by Friday, and actually top out in the upper 60’s in many places on Saturday.
On the global weather front, data from China’s National Climate Center showed average summer temps in the country this year were the highest since records began being kept in 1961. Data also showed rainfall from June 1 to August 31 at the highest level ever recorded, which caused flooding and landslides.
Still not a lot of change in the forecast for South America; Brazil remains nearly completely dry, while temps are seen some 4-8 degrees C above average over the next 10 days. And Argentina also sees a warmer pattern developing, with rains today seen favoring areas in the south.
Have a great day.
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