COMMENTARY 7/19/17

More surprise showers popped up this am in the Dakotas and MN.  The heat HAS arrived for the SW half of the Central Belt through SUN, then diminishing next week with a CHANCE for showers. These showers MAY develop along the N edge of the heat.  This market IS infatuated and on the edge of its seat watching weather models.

CORN

UP 5

Firm but off of its highs. Funds bought an est 10k contracts with the driver weather as the hottest temp of the year hit.  Mid-day weather models added a slight increase in moist chances and continue to signal cooler temps AFTER Sun. That was a relief and helped drive the market off its highs. Weekly EIA data showed ethanol production at 1.026mm bpd, up 19k from last week. Stocks are at 956kb. Our yc continues to be more than Brazil and Arg in the world market. Tomorrow’s Export Sales are expected to be rather puny at just 6 -12 mill bu.

Mon’s Crop Progress:

US YC SILKING:   40%TW,  19% LW, 53% LY, and 47% AVG

IL YC SILKING:   63% TW, 33% LW, 74% LY, and 8% AVG

US CONDITIONS:  64% G/E,  65% LW, and 76% LY

IL CONDITIONS: 62% G/E, 63% LW  a 1% drop

BEANS

UP 10

Higher after putting in a 20 cent range. This was the 2nd consecutive session where Aug fut traded through resistance at the 200 day moving average at $10.02 but did not close above it. Beans continue to follow corn for the moment as it is in critical production phase with as pollination. The GFS increased rain chances for NEXT week, but recent accuracy has been questionable over the last four weeks. Tomorrow’s Export Sales are expected to be light at 4 -11 mill bu.

 

Crop Progress:

US YSB BLOOMING: 52% TW,  34% LW, 56% LY, and 51% AVG

IL YSB BLOOMING:    56% TW, 31% LW, 57% LY, and 54% AVG

US YSB SETTING PODS:   16%TW,  7% LW,  16% LY, and 13% AVG

IL YSB SETTING PODS:   17% TW,  5% LW, 14% LY, and 13% AVG

US CONDITIONS:  61% G/E,  62% LW, and 71% LY

IL CONDITIONS: 67% G/E, 66% LW a 1% increase

 

WHEAT

UNCHANGED

Fundamentally quiet despite a lot of negatives. The US $ was 100 – 200 higher for most of the session. Brazil’s largest wheat growing area experienced a freeze, but damage is still unknown. The muddy fields of spring wheat in N/S Dakota following recent rains WERE too late to help their crop. Huge abandonment of the HRW crop in S Dakota is being confirmed and spotty spring wheat results. The 385 mill bu HRS crop is likely closer to 350 mill bu. This may produce a stock/use ratio of 20% which would be third or fourth tightest in the last 3o years! The HRW, on the other hand, is dealing with a better than expected crop size, heavy farmer selling, and uncompetitive export markets. Russian wheat yields look to be slightly better than anticipated, but protein is coming up short.

Crop Progress:

SPRING WHEAT CONDITIONS:    34 G/E% TW, 35% LW, 69% LY

US WINTER WHEAT HARVESTED:   75% TW, 67% LW, 75 LY, and 73% AVG

IL WINTER WHEAT HARVESTED:    100% TW, 95% LW, 97% LY, and 93% AVG