Written Commentary
MORNING AG OUTLOOK
A sea of red across the Ag space this AM with lower trade all around. Soybean oil remains the downside leader pressured by lower energy prices and fears RIN exemptions being double the previous estimates. US corn ratings slipped more than expected while Spring wheat harvest is running a quicker than expected. Modest declines in soybean and spring wheat crop ratings were in line with expectations. Energy prices are lower on fears of slowing demand as the US summer driving season winds down. Spot WTI crude is down $2.80 per barrel at $82.20. Spot RBOB and HO are both down $.02 per gallon. Rains the past 24 hours favored the Delta and Gulf Coast regions with higher scattered showers in the WCB. Rains this week to favor the Gulf Coast and SE with temperautes holding at normal to below normal readings across much of the nation’s midsection. Above normal temperatures are expected to build across the midwest by weekend and into next week. Rains in SA limited to the interior south of Brazil with normal to above normal temperatures. Rains in C. Europe will bring some drought relief while temperatures remain above normal. The US $$ is slightly higher while US stock indices are up .35%-.80%.
Corn:
Sept-26 and Dec-26 are both down $.01 at $4.90 ½ and $5.14 ½ respectively, both holding within yesterday’s range in 2-sided trade. Crop ratings fell 3% to 57% G/E, vs. expectations for a 1% drop. Overall ratings fell to a new low for the growing season while holding below the historical average. 86% of the crop is in the dough stage, 45% is dented while 6% of the crop is mature, all at or ahead of the 5-year Ave. Updated ratings would suggest an average US yield of 180.1 bpa with production at 15.953 bil. bu., down 30 mil. bu. from last week and 60 mil. below the USDA forecast of 16.013 bil. After closing higher 7 of the past 9 sessions Dec-26 may be pressured by producer selling the last week of August as farmers clear storage space ahead of the upcoming harvest. Yesterday’s high in Dec-26 was nearly $1 bu. above the June low. The European Union Monitoring Agricultural Resource unit (MARS) cut EU corn yield est. 5% to 6.61 mt per HA. Brazil’s 2025/26 2nd crop harvest has reached 92%, still lagging the 98% pace from YA while the 1st crop plantings for 26/27 are underway at 2% complete.
Soybeans:
Sept-26 beans are down $.04 ½ at $12.11 ½ while Nov-26 is $.06 ¼ lower at $12.18. Sept-26 meal is down $1 at $319.30 while Sept-26 oil is down another 133 points at 65.80 with next support at the July low at 65.42. Crush margins have fallen another $.13 ½ to $2.13 ½ bu., the lowest in 6 months. Crop ratings fell 1% to 60% G/E, in line with expectations. Composite ratings fell to the lowest of the crop cycle while just below the historical average. Ratings improved in only 5 states, declining in 12 while holding steady in 1. 91% of the crop is setting pods vs. YA and 5-year Ave. of 88%. 6% of the crop is dropping leaves, in line with YA and the 5-year Ave. Updated ratings suggest an average US yield of 52.8 bpa with production at 4.529 bil. bu., down 19 mil. from last week while just above the USDA forecast of 4.519 bil. D4 RIN’s have traded as low as $1.92, down nearly $.60 from the July peak as the EPA is expected to issue rulings on 34 SRE exemption requests dating back to July-24. Reports suggest SRE relief could total as much as 1.8 bil. well above previous expectations of 1.2-1.3 bil. US Gulf FOB offers continue to hold $.30-$.35 below Brazilian offers.
Wheat:
Prices range are down $.09-$.15. CGO Sept-26 is down $.10 at $6.71 ¾, KC Sept-26 is $.15 lower at $7.35 ½ while Spot MIAX is $.08 ½ lower at $6.85. Spring wheat ratings slipped 1% to 51% G/E, in line with expectations. Composite ratings fell to a new crop cycle low while holding just above the 5-year Ave. 62% of the crop has been harvested, well above expectations and the 5-year Ave. of 52%. Updated ratings suggest an average yield of 48.8 bpa and production at 453 mil. down 4 mil. bu. and well below the USDA forecast of 474 mil. Ukrainian Pres. Zelenskyy insists maritime grain exports are not fully blocked and will continue to seek talks with Russian Pres. Putin to discuss their safe passage. Ukraine’s harvest is nearly complete with 5 mil. HA threshed, or 97% of the planted area. Volume has reached 24.6 mmt vs. the USDA production est. of 25.4 mmt.
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