Written Commentary
CORN
Prices gapped higher overnight while closing $.01 ½ – $.03 higher, near session lows. Spreads were slightly weaker. Both Sept-26 and Dec-26 traded to fresh 6-week highs before pulling back. Damaging heat from this weekend will likely not show up in today’s crop updates. Friday’s CFTC data showed money managers were net buyers of 59k contracts, flipping their position back to net long 12,659 contracts. Friday’s USDA WASDE data showed global stocks/use among major exporting countries for the 2025/26 MY fell to 10.8% in July from 11.5%. Stocks/use for 26/27 fell to 9.8%, down from 10.5% in June. Brazil’s 2nd crop harvest advanced 10% to 40% complete, in line with the YA pace. Export inspections at 56 mil. bu. were in line with expectations and in line with the amount needed to reach the USDA forecast. YTD inspections at 2.281 bil. are up 25% from YA vs. the USDA forecast of up 16%. Noted buyers were Mexico – 18 mil., Japan – 12 mil. while Vietnam took 8 mil. To me the path of least resistance is to the upside. With 26/27 US stocks just under 1.8 bil. bu. we don’t have as much wiggle room for yields coming off the current USDA est. of 183 bpa with production at 16 bil. bu. Cutting yields 3 bpa to 180 would lower ending stocks to roughly 1.5 bil. which in my view would justify prices above $5.
SOYBEANS
Prices were mixed with beans up $.04-$.05, meal was $3-$4 lower while oil prices surged over $.02 lb. Bean spreads were mixed and little changed while product spreads were slightly firmer. Both Aug-26 and Nov-26 beans traded back above $12 before pulling back. Major resistance for Aug-26 is at its March high of $12.31, while resistance for Nov-26 at $12.14. Inside trade for Aug-26 meal while Aug-26 oil traded over $.73 lb. for the first time in 4-weeks. Crush margins rebounded another $.12 ½ to $3.02 bu. with bean oil PV back over 53%. Much above normal temperatures combined with no rain will lead to a rapid depletion of soil moisture in the Northern Plains. Moderate to heavy rain fell across the S. Midwest and parts of the ECB. Precipitation this week will again favor the S. Midwest and Gulf coast region. Limited rain for much of the central midwest, WCB and plain states. The USDA announced a flash sale of 136k mt (5 mil. bu.) to China. Announced sales of new crop soybeans to China/unknown reached 856k mt last week. With the Chinese demand potential and uncertain US weather I expect price pullbacks to be well supported. Export inspections at 15 mil. bu. were in line with expectations while just above the 14 mil. needed per week to reach the revised USDA forecast. YTD inspections at 1.40 bil. are down 18% from YA vs. the USDA forecast of down 20%. Global stocks/use among major exporters fell to 18.5% for the 26/27 MY, down from the revised 19.3% in 25/26 and is the lowest in 13 years.
WHEAT
Prices ranged from steady to $.10 lower in choppy, 2-sided trade. CGO Sept-26 was down $.05 at $6.35 ¼, falling back after reaching a fresh 7-week high. KC Sept-26 was $.10 lower at $6.66 ¼ while MIAX Sept-26 was up $.00 ¾ at $6.53 ¼. Open interest in CGO was little changed from Friday despite heavy speculative buying. We estimate the MM short position is back under 50k contracts in CGO futures. Russian grain shipments thru the Don-Azov channel remain limited following recent Ukrainian missile attacks. It’s estimated 25% of Russian grain shipments pass thru these shipping channels. APK-Inform raised their Ukraine 2026 wheat production forecast .7 mmt to 22.4 mmt vs. the USDA forecast of 24 mmt. Wheat inspections at 14 mil. bu. was in line with expectations and the amount needed to reach the USDA forecast. YTD inspections at 69 mil. bu. is down 17% from YA in line with the USDA forecast. Wheat stocks/use among global exporters is forecast drop to 14.8% in 26/27, down from the revised 17.2% in 25/26.
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