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Grain Comments: 09.06.23

Renewed buying interest supported overnight trade with corn 2-3 higher, soybeans up 10-12 cents, and wheat gaining 4-6 cents. The US dollar and equities were weak while energies were mixed.

 

 

Today’s Reports: CONAB Production Estimates, US Trade Balance

 

  • US posts 7 straight days of soybean sales
  • Argentina offers new Peso incentive on soybeans
  • US dollar index nears 105, economists predict 108

 

 

The ratings of both corn and soybeans declined last week which was not surprising given recent weather. The US corn crop is rated 53% Good/Excellent, down 3% on the week. The Poor/Very Poor rating increased 1 point to 18%. The corn crop is now 18% mature which is 2% ahead of normal. The US soybean rating declined 5 points to end at 53% G/E as well. The P/VP rating increased 3% to come in at 17%. Leaves have dropped on 16% of the crop compared to the normal 13%. The spring wheat harvest is now at 74% complete which is 3% behind average. Winter wheat seeding is at 1%, down from the usual 3% on this date. While these numbers will be factors in today’s trade, more interest is being placed on actual harvest reports from across the Corn Belt. Harvest is now moving into the heart of the Corn Belt and yields remain better than initially expected in several areas. The worst of the production area will not see harvest for at least another week or two though and analysts feel this will drop average yields. The most concern right now is on Northern Iowa, Southern Minnesota, and Southern Wisconsin. As always, the question is if yields are good enough in other states to make up for these trouble spots.

 

Headlines

–         El Nino building

–         95% chance of El Nino through summer 2024

–         55% chance of El Nino into fall 2024

–         US barge freight continues to rise

–         Barge freight +$8.00/ton in past week

–         China PMI +2% from July to August

–         China PMI expansion first in 6 months

–         Panama Canal wait times increase

–         Sep WASDE on the 12th

–         WASDE will be first with field collected data

 

Corn

–         Early harvest data mixed

–         High crop variability expected

–         US heat causing test weight concerns

–         Shallow kernels also reported

–         Ethanol values remain high, support demand

 

Soybeans

–         Argentine crush -27% from last year

–         India oilseed imports to rise

–         Soybean crop seeing stressful finish

–         Biodiesel demand supports soy oil

–         Crush covering soy oil demand so far

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