Good morning.
Another quiet/low volume night of trade was had at the CBOT, as no corn or bean contract cleared 10,000 contracts of volume by 6am central time this morning. Generally speaking, hedge pressure from the US farmer keeps rallies limited, while geopolitical tensions and less-than-perfect weather to start Brazil’s spring season look to keep a floor under prices. Yield data over the next 4-8 weeks likely determines some of the day-to-day price action, but as we get further into winter, big picture prices moves will begin to be predicated on what’s going on in South America. Corn futures this morning are trading unchanged to a penny higher, soybean futures are up 1-2 cents, and the Chicago wheat market is up 3-4 cents. Products are mixed, soybean meal is down $1/ton, and soybean oil is up 40-50 points. Outside markets are also mixed, crude oil futures are trading 10-20 cents/bbl higher, the Dow Jones index is up 130 points, and the US$ index is down 15 points. The S&P500 is up 20 points, and the NASDAQ is up 120 points.
Yesterday afternoon’s crop progress update showed as of Sunday the 15th, 9% of the US corn crop had been harvested and 6% of the US soybean crop had been harvested; both figures are 3% ahead of the five-year average.
Best progress continues to be seen in the south; TX is 80% harvested on corn this week, while NC is 47% and TN is 46%. MO and KS are 25% complete and 26% respectively. The Delta area has been the most active for soybean harvest, with LA showing 46% complete, MS showing 44% complete, and AR showing 29% complete.
Corn conditions increased 1% in the g/ex category to 65%, while the amount of crop dented increased 11% to 85%. Corn maturity reached 45% on the week, up from 29% last week.
At the state level, biggest improvements on the week in the g/ex category for corn were seen in Pennsylvania (+9%), Michigan (+7%) and Minnesota (+5%). Biggest declines were in Indiana (-5%), South Dakota (-5%), and Kansas (-3%).
Soybean conditions in the g/ex category were down 1% on the week to 64% g/ex. The amount of the crop dropping leaves came in at 44%, up from 25% last week.
At the state level for soybeans, only three states saw improving conditions: Minnesota (+4%), Illinois (+2%), and Michigan (+1%). Biggest declines on the week were seen in Louisiana (-9%), Arkansas (-7%) and Ohio (-7%).
Statistics Canada updated crop production estimates for the country on Monday; the group sees wheat production at 34.3 mmt’s, down 0.1 mmt’s from their previous estimate but still up from last year’s 32.9 mmt’s. Canola production was lowered from 19.5 mmt’s to 19.0 mmt’s, which is now below last year’s 19.2 mmt’s.
Officials from Capeco, a grain and oilseed export group in Paraguay, say the country has roughly 1 mmt of soybeans left to export in the 2024 season, and that they see this export program being complete by the end of October. Same group estimates soybean production in Paraguay for the year in 2024 at more than 10 mmt’s.
USDA currently shows 88,400 mt’s of outstanding new crop soybean sales to Argentina in the current crop year, as FOB prices from the Gulf are some $16/mt cheaper than local Argentine beans. This would be the first time since 2019 that the South American country has imported beans from the US.
USDA did note on Monday that the sales would be reviewed, and if corrections were necessary, they would be reported in the weekly export sales report on Thursday, September 19th. Low river levels on the Parana River have limited barges going to Argentina, which likely also helped spur the purchases.
France’s ag minister dropped their estimate of soft wheat production in the country to 25.8 mmt’s, down from last month’s estimate of 26.3 mmt’s. The figure is nearly 27% below last year’s production. Corn harvest, however, is seen increasing 11% from last year to 14.4 mmt’s.
Ahead of the start of the Fed Policy meeting this morning, financial markets will see retail sales data released for August, which is one of the final data pieces due out ahead of the interest rate decision on Wednesday. The avg trade guess is for a 0.2% decline, following a 1.0% increase in July.
The CME’s FedWatch Tool this morning shows a 65% chance at a 50-basis point cut tomorrow, though as mentioned previously, retail sales data this morning could potentially change that. The Fed is set to make a decision at 1pm central time on Wednesday.
24-hour satellite data shows scattered precipitation across the west-central portion of the country on Monday, with totals across KS/NE and into the Dakota’s/MN ranging anywhere from 0.01-1″ generally speaking, with some locally heavier amounts. Most all of North Carolina also received 1.5-2.5″ of rainfall on Monday according to satellite.
For the rest of the week, models see additional rains falling in Montana and into Canada, while scattered thunderstorm activity provides additional moisture as far west as the Mississippi River. Totals range from 0.01-1″ for the most part.
Temps look to stay seasonally warm into next week across most of the Midwest; highs stay in the mid/upper 80’s into this weekend, before pulling back slightly to the upper 70’s/low 80’s into the early part of next week. An active trough pattern keeps the northwest in a cooler bias.
Week-two forecasts have seen a bit of a shift to a wetter bias in the southeast overnight vs what was seen yesterday; the CPC and EU ensemble are in fairly good agreement in this solution, while the EU AI model is wetter and the GFS ensemble is drier and has moisture more in the central part of the Midwest. This shift will need monitoring.
Satellite data shows parts of Santa Catarina, Parana, Sao Paulo and Mato Grosso do Sul in southern Brazil picked up more than an inch of rainfall in places on Monday, though the rest of the country and Argentina were dry.
Have a great day.
Grain Comments: 09-17-2024
Good morning.
Another quiet/low volume night of trade was had at the CBOT, as no corn or bean contract cleared 10,000 contracts of volume by 6am central time this morning. Generally speaking, hedge pressure from the US farmer keeps rallies limited, while geopolitical tensions and less-than-perfect weather to start Brazil’s spring season look to keep a floor under prices. Yield data over the next 4-8 weeks likely determines some of the day-to-day price action, but as we get further into winter, big picture prices moves will begin to be predicated on what’s going on in South America. Corn futures this morning are trading unchanged to a penny higher, soybean futures are up 1-2 cents, and the Chicago wheat market is up 3-4 cents. Products are mixed, soybean meal is down $1/ton, and soybean oil is up 40-50 points. Outside markets are also mixed, crude oil futures are trading 10-20 cents/bbl higher, the Dow Jones index is up 130 points, and the US$ index is down 15 points. The S&P500 is up 20 points, and the NASDAQ is up 120 points.
Yesterday afternoon’s crop progress update showed as of Sunday the 15th, 9% of the US corn crop had been harvested and 6% of the US soybean crop had been harvested; both figures are 3% ahead of the five-year average.
Best progress continues to be seen in the south; TX is 80% harvested on corn this week, while NC is 47% and TN is 46%. MO and KS are 25% complete and 26% respectively. The Delta area has been the most active for soybean harvest, with LA showing 46% complete, MS showing 44% complete, and AR showing 29% complete.
Corn conditions increased 1% in the g/ex category to 65%, while the amount of crop dented increased 11% to 85%. Corn maturity reached 45% on the week, up from 29% last week.
At the state level, biggest improvements on the week in the g/ex category for corn were seen in Pennsylvania (+9%), Michigan (+7%) and Minnesota (+5%). Biggest declines were in Indiana (-5%), South Dakota (-5%), and Kansas (-3%).
Soybean conditions in the g/ex category were down 1% on the week to 64% g/ex. The amount of the crop dropping leaves came in at 44%, up from 25% last week.
At the state level for soybeans, only three states saw improving conditions: Minnesota (+4%), Illinois (+2%), and Michigan (+1%). Biggest declines on the week were seen in Louisiana (-9%), Arkansas (-7%) and Ohio (-7%).
Statistics Canada updated crop production estimates for the country on Monday; the group sees wheat production at 34.3 mmt’s, down 0.1 mmt’s from their previous estimate but still up from last year’s 32.9 mmt’s. Canola production was lowered from 19.5 mmt’s to 19.0 mmt’s, which is now below last year’s 19.2 mmt’s.
Officials from Capeco, a grain and oilseed export group in Paraguay, say the country has roughly 1 mmt of soybeans left to export in the 2024 season, and that they see this export program being complete by the end of October. Same group estimates soybean production in Paraguay for the year in 2024 at more than 10 mmt’s.
USDA currently shows 88,400 mt’s of outstanding new crop soybean sales to Argentina in the current crop year, as FOB prices from the Gulf are some $16/mt cheaper than local Argentine beans. This would be the first time since 2019 that the South American country has imported beans from the US.
USDA did note on Monday that the sales would be reviewed, and if corrections were necessary, they would be reported in the weekly export sales report on Thursday, September 19th. Low river levels on the Parana River have limited barges going to Argentina, which likely also helped spur the purchases.
France’s ag minister dropped their estimate of soft wheat production in the country to 25.8 mmt’s, down from last month’s estimate of 26.3 mmt’s. The figure is nearly 27% below last year’s production. Corn harvest, however, is seen increasing 11% from last year to 14.4 mmt’s.
Ahead of the start of the Fed Policy meeting this morning, financial markets will see retail sales data released for August, which is one of the final data pieces due out ahead of the interest rate decision on Wednesday. The avg trade guess is for a 0.2% decline, following a 1.0% increase in July.
The CME’s FedWatch Tool this morning shows a 65% chance at a 50-basis point cut tomorrow, though as mentioned previously, retail sales data this morning could potentially change that. The Fed is set to make a decision at 1pm central time on Wednesday.
24-hour satellite data shows scattered precipitation across the west-central portion of the country on Monday, with totals across KS/NE and into the Dakota’s/MN ranging anywhere from 0.01-1″ generally speaking, with some locally heavier amounts. Most all of North Carolina also received 1.5-2.5″ of rainfall on Monday according to satellite.
For the rest of the week, models see additional rains falling in Montana and into Canada, while scattered thunderstorm activity provides additional moisture as far west as the Mississippi River. Totals range from 0.01-1″ for the most part.
Temps look to stay seasonally warm into next week across most of the Midwest; highs stay in the mid/upper 80’s into this weekend, before pulling back slightly to the upper 70’s/low 80’s into the early part of next week. An active trough pattern keeps the northwest in a cooler bias.
Week-two forecasts have seen a bit of a shift to a wetter bias in the southeast overnight vs what was seen yesterday; the CPC and EU ensemble are in fairly good agreement in this solution, while the EU AI model is wetter and the GFS ensemble is drier and has moisture more in the central part of the Midwest. This shift will need monitoring.
Satellite data shows parts of Santa Catarina, Parana, Sao Paulo and Mato Grosso do Sul in southern Brazil picked up more than an inch of rainfall in places on Monday, though the rest of the country and Argentina were dry.
Have a great day.
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