Good morning.
Interest rate week has finally made it, as macro headlines will steal a lot of the attention in the commodity space over the next five days. Some sort of cut is nearly guaranteed by the conclusion of the Fed’s September policy meeting on Wednesday, but whether the cut will be 25 basis points or 50 basis points is still up for debate. Specific to the ag world, continued dry weather through the Midwest over the weekend caused a further speed up in early harvest progress, with this trend looking to continue into the new week as the forecast remains on the dry side. By this time a week from now, harvest will more than likely be in full swing across most of the Corn Belt. Corn futures this morning are trading 3-4 cents lower, soybean futures are 1-3 cents lower, and the Chicago wheat market is down 9-10 cents. Products are mixed/quiet, soybean meal is up around $1/ton, and soybean oil is down 5-10 points. Outside markets are also mixed, crude oil futures are up 60-70 cents/bbl, the Dow Jones index is up 100 points, and the US$ index is down 45 points. The S&P500 is near unchanged, and the NASDAQ is down 75 points.
CFTC data released Friday afternoon for the week ending September 10th showed funds in the week were buyers of 44,077 contracts of corn, buyers of 23,495 contracts of soybeans, and were sellers of 13,277 contracts of Chicago wheat. This makes them now net-short 132,134 contracts of corn, net-short 130,601 contracts of soybeans, and net-short 13,227 contracts of Chicago wheat.
In soy products, funds were buyers of 13,877 contracts of soybean meal, and were sellers of 90 contracts of soybean oil; this makes them now net-long 37,048 contracts of soybean meal, and net-short 47,617 contracts of soybean oil.
NOPA’s soybean crush report for the month of August is due out at 11am central time this morning; traders see the report showing soybean crush in the month at 171.325 mil bu’s, while stocks of soybean oil are estimated at 1.356 bil lbs. The crush figure would be down 6.3% from July, while bean oil stocks would be down 9.5% from July.
Officials from the Mato Grosso Institute of Agricultural Economics said that soybean planting in the state over the past week only occurred in a few irrigated areas, as producers continue to wait on better rainfall. Last year, just 1% of Mato Grosso’s soy area was planted as of this past weekend.
Authorities in Russia’s southern Rostov region over the weekend recorded more than 50 wildfires, with roughly 30 remaining active into Monday; sparks from downed power lines are said to have been the cause of the fires. The Rostov region accounts for roughly 11% of Russia’s annual grain harvest.
India’s finance ministry announced over the weekend that as of Saturday, import taxes on some crude and refined edible oils, including palm, soybean and sunflower oils, would be raised from the current 5.5% level to 27.5%. Duties on refined grades would be lifted from 13.75% to 35.75%.
US Federally inspected beef production in the week ending September 14th was seen at 527 mil lbs., which was an increase of nearly 15% from the week prior. Pork production at 540 mil lbs. was up just under 11% for the week. YTD beef production is down 1.1% from last year, and pork production is up 1.7%.
As mentioned earlier, the million-dollar question going into the week in the equity world is whether the Fed will cut rates by 25 or 50 basis points on Wednesday. The CME’s Fed Watch Tool currently sees a 59% chance of a 50-point cut, with a 41% chance of a 25-point cut as of Monday morning.
Other news over the weekend included a second assassination attempt on former US President Donald Trump in as many months, though the Republican nominee in the 2024 election was again unharmed.
Members of Trump’s secret service detail engaged an unknown suspect roughly 300-500 yards away from Trump after the suspect fired shots from an AK-47 style rifle at the former president while he was on his golf course in South Florida. The man fled and was later stopped and taken into custody by Florida police.
Officials from NOAA’s Climate Prediction Center see a 71% chance for the emergence of La Niña between September and November this year, with the system expected to persist into March of next year. Officials due note though that the formation may be weaker than normal, potentially lessening its conventional winter impacts.
48-hour satellite data shows precipitation over the weekend was mostly confined to the southeast and west-central Plains; the remnants of Francine provided an additional 0.1-2.0″ across parts of AR/AL/MS/TN, while scattered storms gave the Dakota’s into NE anywhere from trace amounts to an inch generally speaking, with the heavier amounts more in the Dakota’s.
For the coming week, the EU model sees continued rainfall chances for the northwest and western portions of the Corn Belt, though its forecast is wetter than that of the GFS model. Heaviest amounts of 2-4″ will be seen across Montana and into Alberta/Saskatchewan between now and Saturday according to the EU solution.
Models also see additional moisture for the southeast and east coast as the Atlantic/Gulf stay active for another week. ‘Potential Tropical Cyclone Eight’ as it is now being called, is expected to come onto land in South Carolina sometime tonight/tomorrow morning, though sustained winds are not expected to be above 39mph.
Week-two forecasts are similar on Monday to what was seen at the end of last week but are slightly drier in the country’s mid-section and slightly wetter in the southeast. The EU and GFS ensemble solutions are in fair agreement, while the EU’s AI model is significantly wetter from TX up into the Dakota’s/MN.
Temps this week across the Midwest will be very similar to last week, with highs staying in the mid/upper 80’s for most of the Corn Belt. Troughs from the west bring cooler air back into the area by the middle of next week, but confidence this far out is low.
Not a lot of forecast change in South America over the weekend; models continue to see spotty showers in southern Brazil this week and next, while more widespread rainfall chances are still seen occurring into the first part of October.
Have a great day.
Grain Comments: 09-16-2024
Good morning.
Interest rate week has finally made it, as macro headlines will steal a lot of the attention in the commodity space over the next five days. Some sort of cut is nearly guaranteed by the conclusion of the Fed’s September policy meeting on Wednesday, but whether the cut will be 25 basis points or 50 basis points is still up for debate. Specific to the ag world, continued dry weather through the Midwest over the weekend caused a further speed up in early harvest progress, with this trend looking to continue into the new week as the forecast remains on the dry side. By this time a week from now, harvest will more than likely be in full swing across most of the Corn Belt. Corn futures this morning are trading 3-4 cents lower, soybean futures are 1-3 cents lower, and the Chicago wheat market is down 9-10 cents. Products are mixed/quiet, soybean meal is up around $1/ton, and soybean oil is down 5-10 points. Outside markets are also mixed, crude oil futures are up 60-70 cents/bbl, the Dow Jones index is up 100 points, and the US$ index is down 45 points. The S&P500 is near unchanged, and the NASDAQ is down 75 points.
CFTC data released Friday afternoon for the week ending September 10th showed funds in the week were buyers of 44,077 contracts of corn, buyers of 23,495 contracts of soybeans, and were sellers of 13,277 contracts of Chicago wheat. This makes them now net-short 132,134 contracts of corn, net-short 130,601 contracts of soybeans, and net-short 13,227 contracts of Chicago wheat.
In soy products, funds were buyers of 13,877 contracts of soybean meal, and were sellers of 90 contracts of soybean oil; this makes them now net-long 37,048 contracts of soybean meal, and net-short 47,617 contracts of soybean oil.
NOPA’s soybean crush report for the month of August is due out at 11am central time this morning; traders see the report showing soybean crush in the month at 171.325 mil bu’s, while stocks of soybean oil are estimated at 1.356 bil lbs. The crush figure would be down 6.3% from July, while bean oil stocks would be down 9.5% from July.
Officials from the Mato Grosso Institute of Agricultural Economics said that soybean planting in the state over the past week only occurred in a few irrigated areas, as producers continue to wait on better rainfall. Last year, just 1% of Mato Grosso’s soy area was planted as of this past weekend.
Authorities in Russia’s southern Rostov region over the weekend recorded more than 50 wildfires, with roughly 30 remaining active into Monday; sparks from downed power lines are said to have been the cause of the fires. The Rostov region accounts for roughly 11% of Russia’s annual grain harvest.
India’s finance ministry announced over the weekend that as of Saturday, import taxes on some crude and refined edible oils, including palm, soybean and sunflower oils, would be raised from the current 5.5% level to 27.5%. Duties on refined grades would be lifted from 13.75% to 35.75%.
US Federally inspected beef production in the week ending September 14th was seen at 527 mil lbs., which was an increase of nearly 15% from the week prior. Pork production at 540 mil lbs. was up just under 11% for the week. YTD beef production is down 1.1% from last year, and pork production is up 1.7%.
As mentioned earlier, the million-dollar question going into the week in the equity world is whether the Fed will cut rates by 25 or 50 basis points on Wednesday. The CME’s Fed Watch Tool currently sees a 59% chance of a 50-point cut, with a 41% chance of a 25-point cut as of Monday morning.
Other news over the weekend included a second assassination attempt on former US President Donald Trump in as many months, though the Republican nominee in the 2024 election was again unharmed.
Members of Trump’s secret service detail engaged an unknown suspect roughly 300-500 yards away from Trump after the suspect fired shots from an AK-47 style rifle at the former president while he was on his golf course in South Florida. The man fled and was later stopped and taken into custody by Florida police.
Officials from NOAA’s Climate Prediction Center see a 71% chance for the emergence of La Niña between September and November this year, with the system expected to persist into March of next year. Officials due note though that the formation may be weaker than normal, potentially lessening its conventional winter impacts.
48-hour satellite data shows precipitation over the weekend was mostly confined to the southeast and west-central Plains; the remnants of Francine provided an additional 0.1-2.0″ across parts of AR/AL/MS/TN, while scattered storms gave the Dakota’s into NE anywhere from trace amounts to an inch generally speaking, with the heavier amounts more in the Dakota’s.
For the coming week, the EU model sees continued rainfall chances for the northwest and western portions of the Corn Belt, though its forecast is wetter than that of the GFS model. Heaviest amounts of 2-4″ will be seen across Montana and into Alberta/Saskatchewan between now and Saturday according to the EU solution.
Models also see additional moisture for the southeast and east coast as the Atlantic/Gulf stay active for another week. ‘Potential Tropical Cyclone Eight’ as it is now being called, is expected to come onto land in South Carolina sometime tonight/tomorrow morning, though sustained winds are not expected to be above 39mph.
Week-two forecasts are similar on Monday to what was seen at the end of last week but are slightly drier in the country’s mid-section and slightly wetter in the southeast. The EU and GFS ensemble solutions are in fair agreement, while the EU’s AI model is significantly wetter from TX up into the Dakota’s/MN.
Temps this week across the Midwest will be very similar to last week, with highs staying in the mid/upper 80’s for most of the Corn Belt. Troughs from the west bring cooler air back into the area by the middle of next week, but confidence this far out is low.
Not a lot of forecast change in South America over the weekend; models continue to see spotty showers in southern Brazil this week and next, while more widespread rainfall chances are still seen occurring into the first part of October.
Have a great day.
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