Written Commentary
CORN
Prices were up $.07-$.08 today closing at session highs. Despite the recovery nearby spreads remain historically wide. Agricultural commodities were mostly higher today driven by forecasts that feature little to no precipitation across the nation’s midsection for the next week to 10 days. Talk of lower than expected yields in SD uncovered during the Pro Farmer crop tour also seem to be providing support. Dec-24 was able to close back above the $4.00 level with next resistance at the 50 day MA, currently $4.22. Last week money managers were net sellers of 6,462 contracts of corn extending their short position to 249k vs. the recent record short position of 354k. Index funds were net sellers of 11,500 contracts reducing their long position to 214k contracts, their smallest holding since Dec-2023. Export inspections at 46 mil. bu. were above expectations and above the 43 mil. bu. needed per week to reach the revised USDA export forecast of 2.250 bil. bu. YTD inspections are up 38.5% from YA vs. the USDA forecast of up 35%. Largest takers last week were Mexico – 23 mil. and Japan – 13 mil. bu
SOYBEANS
The soybean complex was higher across the board with beans up $.16-$.19, meal was $7-$8 higher while oil was up 30-50. Next resistance for Nov-24 beans is last week’s high of $10.02 ½, with longer term resistance at the 50 day MA currently $10.68 1/4. Despite the strength nearby spreads made new lows. Next resistance for Sept-24 oil is 42.61 followed by the 50 day MA currently 44.06. Next resistance for Sept-24 meal is at $329.50. Crops are not expected to experience a high level of stress, at least initially, as temperatures remain seasonally mild across the heart of the Midwest. Drought readings remain low with extreme heat limited to the deep south and far WCB for much of this week. By this weekend however, above normal temperatures are expected to expand over much of the Midwest bringing temperatures up to the low to mid 90’s. A widespread rain event is needed by early September to optimize yield potential. MM’s were net sellers across the soy complex last week selling just over 5k beans, 1k oil and 41k meal. Index funds were also net sellers of 16k contracts across the soybean complex. Export inspections at 15 mil. bu. were in line with expectations however below the 20 mil. needed per week to reach the USDA export forecast of 1.70 bil. YTD inspections at 1.609 bil. are down 15% from YA, in line with the USDA forecast. Germany was the largest taker with 5 mil. bu. In addition the USDA announced the sales of 332k tons (12 mil. bu.) to China and 110k tons (4 mil. bu.) to unknown. Spot board crush margins rebounded $.06 ½ today to $1.74 ½ bu. Bean oil PV holding just above 39%.
WHEAT
Prices were mixed today with KC steady to $.02 higher, MGEX was down $.05-$.06 while Chicago was mixed with modest bear spreading noted. All 3 classes traded on both sides of unchanged. The hot/dry pattern across eastern Ukraine and southern Russia will remain intact this week. Central growing areas of Argentina will see better prospects for rain this week however southern and eastern growing regions are again favored for the best coverage. Conditions in Australia remain mostly favorable. Last week MM’s were buyers of just over 3k KC wheat while being lite sellers of both Chicago and MGEX. In total as of last Tuesday MM’s were net short 73k Chicago, 33k KC and nearly 26k MGEX. Export inspections at 13 mil. bu. were below expectations and below the 16 mil. bu. needed per week to reach the USDA forecast. Last week’s inspections were revised up 1 mil. bringing YTD inspections to 168 mil., up 26% from YA, vs. the USDA forecast of up 15%.
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