| Geopolitics: If you’ve missed it, here is the list of some of the main speakers we’ve heard from at the DNC: Monday was Hillary Clinton, Rep. Alexandria Ocasio-Cortez, first lady Jill Biden, and President Joe Biden. Yesterday we heard from Sen. Bernie Sanders, Illinois Gov. JB Pritzker, Michelle Obama and former President Barack Obama. Tonight we can expect to hear from: VP nominee Tim Walz, former President Bill Clinton, Speaker Nancy Pelosi, and Transportation Sec. Pete Buttigieg.
Macroeconomics: The US dollar relative to a basket of foreign currencies has dropped from the June highs of 106.05 to 101.53 today. A strong dollar, like what we saw in the early 2000s and again in 2022, would mean we have an advantage in buying foreign goods, but the cost of goods in the US are high. So a strong vs. weak dollar benefit different people depending on how you look at it. A strong dollar could hurt US exports if the foreign buyers can not afford to pay the high exchange rate. The Federal Reserve hiking rates tends to increase the value of the dollar and the Fed cutting rates tends to lower the value.
Ag Fundamentals: The Pro Farmer Crop Tour continues this week with results from Indiana and Nebraska released yesterday. The USDA estimated the corn yield for Indiana at 207 bushels per acre and the Pro Farmer’s estimate came in at 187.5. Comparing these numbers to last year’s results: Pro farmer shows an increase of 7 bpa while the USDA is showing an increase of only 4 bpa year-over-year in Indiana. Based on the pod count data from yesterday (1409 per 3×3 plot) and the USDA’s record 62 bps yield estimate for Indiana, we can expect a big bean crop from the Hoosier State. Nebraska’s yields came in strong as well if you compare them year over year, but the pro farmer is still much lower than the USDA estimates. Pro farmer had Nebraska corn at 173.3 bpa vs. last year at 167.2. The USDA recently estimated the state’s corn yield at 194, up 12 bpa from last year’s USDA estimate. The USDA had beans pegged at 59 bushels per acre (up 15% from last year) in Nebraska. The Pro Farmer came up with a pod count of 1,172 per 3×3 plot which would just be a 1% increase from last year’s tour. Overall both states should expect very large crops. Looking forward to seeing Illinois, northern Iowa and southern Minnesota’s results later today.
Weather: Over the next 14 days a majority of the corn belt will be dry with only Minnesota, Wisconsin and parts of northern Illinois receiving rain. The ridge sitting over the eastern US will open and the heat will stretch across all major growing areas by the end of the month. This will not offer any relief to the southern Mississippi river levels before they move into the heart of their harvest window. No systems are expected to develop off the east coast of Africa until possibly early September, meaning a hurricane will not save the Mississippi in time. |
