Category: Ag Markets Update

FOR THURSDAY: (8/25) Wire reports say the scouts found healthy Illinois corn and soybean crops with yields and pod counts above last year. Crop tour findings will be scrutinized to determine if USDA’s big crop and yields are doable. Stress from dry conditions hurt corn in Indiana and Ohio. Wire reports say Illinois surveys found a good, but not great, crop. Weather forecasts remain favorable for corn and soybeans with cool, wet conditions this week in the Midwest, but warm and wet conditions next week. Severe storms move through southern Iowa, northern Missouri and western Illinois today before dissipating by Thursday. However, rain lingers in the Midwest.

We are ready to take profits on shorts but thinking that markets may be down even through Friday–and if there is a buy, it will be Monday. Hogs still look weak a few more days and cattle are an aggressive sale as they are rather oversold but still probably down at least 1 more day.

FOR WEDNESDAY: (8/24) Crop tours in the Midwest are finding some minor problems in corn and soybeans, but apparently nothing serious enough to raise doubts about USDA big numbers for both crops. Also the tours move to Iowa and Illinois later this week where conditions are better. Weather forecasts remain favorable for corn and soybeans with cool, wet conditions due in the Midwest this week and warm, wet conditions next week. Severe storms do develop in Nebraska and Iowa today and then develop in Kansas and Missouri on Wednesday.

We could easily see grains correct into Friday before coming back next week. Hopes for recoveries are based in hot and dry July weather eventually hurting weights but that may be more for the Eastern belt and the Midwest may not be hurt as much. In the end, the next push up will have to be sold. We have to do some research on freeze cycles this year. It’s been a while since there has been a freeze, and that may be the only hope for higher prices past late August or early Sept.

FOR TUESDAY: (8/23) Grains are overbought and due for a setback and there‘s nothing positive in the weekly reports. Would expect a 2-3 day pullback. Cattle should be up 1-2 more days and hogs look lower next week and not sure month to month declines in cold storage can save year to year stats.

FOR MONDAY: (8/22) Grains may hold up for 1 more day and some upward patterns aren’t complete to 1027 on Nov. beans and 352 on Dec. corn and 452 on Dec. wheat. We’re open to selling starting early Tuesday if the market reaches those levels. Weather forecasts are favorable for corn and soybeans with cool, wet conditions due in the Midwest next week. Severe storms develop in Kansas, Nebraska and Iowa on Friday with flash flood warnings posted for central Kansas. Cattle on Feed was mildly bearish and may be faded for a few days from oversold conditions. Hogs are waiting for cold storage late Monday.

FOR THURSDAY: (8/18) Severe storms may develop in South Dakota and Minnesota on Thursday and then in Nebraska and Iowa on Friday. Midwest weather turns cooler next week with rain likely. Rain lingers in Louisiana then but the heavier amounts move north. Recent rain and flooding in that state slowed exports as it slowed vessel loading.

Grain cycles turn lower Thursday and Friday and profit-taking may set in markets are near pattern completions at 1027 on Nov. beans and 342 on Dec. corn. Cattle still look lower into early Friday but COF report should create some short-covering. Hogs may also do short-covering into their reports.

FOR WEDNESDAY: (8/17) Weather turns cooler next week in the Midwest with rain likely. Rain in Louisiana appears to be abating, which may ease flooding there and allow boats to be loaded with grain. Cash corn bids at the Gulf dropped about a dime late last week as rain and flooding disrupted export loadings. A lower dollar provided some under lying support to Tuesday’s crops. China bought 4.37 million bushels of 2016/2017 soybeans.

Cycles suggest that grains could pull back a few days here and we’re not in a rush to chase longs up here and have suggested continued profit-taking on multiples. Cattle look like they will stay in trouble and hogs look lower on Wednesday and offer no new risk/reward for shorts.

FOR TUESDAY: (8/16) In the weather, current forecasts favor rain and mild temperatures this week. The seven-day forecast keeps rain in Indiana and Ohio, but the heaviest amounts are north and over the Great Lakes. The 6- to 10-day outlook (Aug. 20-24) has cool, wet conditions for the western half of the Midwest. Normal to above-normal temperatures are favored for Indiana and Ohio.

Motivation for the rally appeared tied to a batch of daily export sales since August 1 and a monthly crush report that showed tight supplies of soybean oil. Soybean oil jumped more than 3% in Monday’s trading after the National Oilseed Processors Association said stocks in July were 1.743 billion lbs, much less than the 2.0 billion the trade expected and the 1.985 billion a year ago. Cycles are still friendly on Tuesday but a pullback mid-week is likely. One would think some profit taking may set in after the strong rally since Friday.

FOR MONDAY: (8/15) In typical fashion the trade took profits on the bearish report and the worst may be over now. USDA expects a record 15.15 billion bushel corn crop, a 4.06 billion soybean crop and 2.32 billion bushels of wheat. The corn and soybean numbers topped all forecasts in some pre-market surveys and sent corn futures to contract lows before they recovered. National Weather Service notes current forecasts favor rain and mild temperatures through next week. Heavy rain is expected in the Ohio River Valley the next few days and has the National Weather Service posting flash flood warnings for southern Indiana and Ohio.

The 6- to 10-day outlook (Aug.16-19) has normal to above-normal temperatures for the Midwest and northern Plains with above-normal chances for rain for much of the Midwest. Usually grains recover in August and cycles are a bit more bearish on Sunday than Monday, that may give us a chance to get in.

FOR FRIDAY: (8/12) Forecasts keep rain in parts of the Midwest the next seven days with the largest amounts in the dry areas of Indiana and Ohio. Severe storms move through Iowa today and rain could linger in the Midwest on Friday. The 6- to 10-day outlook (Aug.16-19) has hot weather in the northern Midwest and northern Plains then with below-normal chances for rain for much of the Midwest.

A strong rally in crude is supportive for the complex but it may give back gains next week. Grains will most likely have more of a negative reaction on Friday and that will give us oversold conditions to buy for the rest of the month by early next week.

For Friday’s USDA report, private firms expect expects corn crop of about 14.59 billion bushels at 168.6 bpa and a soybean crop of 3.865 billion at 46.65 bpa. USDA currently has corn at 14.54 billion bushels and 168 bpa, and soybeans at 3.88 billion at 46.7 bpa.

FOR THURSDAY: (8/11) Forecasts keep rain in parts of the Midwest the next seven days, with the largest amounts in the dry areas of Indiana and Ohio. Severe storms move through parts of the eastern Dakotas today before dissipating. The 6- to 10-day outlook (Aug.15-18) has hot weather in the northern Midwest and northern Plains then, with below-normal chances for rain for much of the Midwest.

For Friday’s USDA report, private firms expect expects corn crop of about 14.59 billion bushels at 168.6 bpa and a soybean crop of 3.865 billion at 46.65 bpa. USDA currently has corn at 14.54 billion bushels and 168 bpa, and soybeans at 3.88 billion at 46.7 bpa.

Not much to do on Thursday. Cycles for Friday seem volatile so will stay open to see lower pattern completed with a very bearish report.