COMMENTARY 7/24/15

**TIME TO HUSTLE!! ~ MARKETS ARE INVERTED ~ DON’T BE LATE WITH JULY YC & YSB CONTRACTS!**

CHECK THOSE CORN BINS!! ~ BLUE EYE MOLD IS STARTING TO SHOW UP! 

St Louis river level FALLING at +31.0 and forecast  to be 22.5 by  7/28.

Warmer to hot weather rolls in next week with an increase in chance for showers.   This should result in near normal rainfall for most corn/bean areas, especially the dry areas in the North.   August is expected to start cooler and considerably drier conditions.

CORN

DOWN 11    (That makes a 27 cent drop for the week!)

Weather certainly isn’t a threat.  It is SO mundane, to the extent that some analysts are now actually RAISING yield estimates. Plus, talk 8-10 cargoes of Brazil corn have been bought to come into the SE didn’t lend any support. That should help the transition from Old Crop into New Crop a bit easier.  A new sale of 231 K corn was sold to Mexico in 15/16 & 16/17.   Ideas for NEXT Monday’s Crop Ratings are mostly unchanged at 69% G/E vs last year at 75%.  Some see even a 1-2% higher as a distinct possibility.  Next weeks hotter weather may challenge that if forecasted rain fails to materialize.  Morgan Stanley estimates the US yield at 164.6, 2.4 bpa below the USDA’s trend-line.  The Argentina Ag Minister says their crop is now 77% harvested and maintains their crop estimate at 31 MMT vs the USDA’s est at 25.0. Wire services report 900 billion barrels of Brazilian ethanol are scheduled to reach US shores by end of September.

Bloomberg Trader Bias:  Bullish 15% This Week (16% LW), Bearish 58% (48% LW), Neutral 27% (36% LW)

LAST Monday’s Crop Progress:

US CONDITION: 69% G/E , 69% LW  76% LY   STATE OF IL CONDITION: 55% G/E 56% LW (down 1% from LW)

SILKING:   55% TW,  27% LW, 53% LY, and 56% AVG.  The State of IL SILKING:  75% TW, 55% LW, 79% LY, and 77% AVG.

BEANS     

OLD ~DOWN 19      NEW ~ DOWN 15

Funds sold 8,000 contracts today.  China is believed to be mostly covered through October and with new crop purchases from the US.  If true, that is down 2/3 of normal and doesn’t look good for fall exports.  A new sale of220 K MT was sold to China for 15/16 delivery.  This coming Monday’s crop ratings are expected to be unchanged at 62% G/E.  Last year was 71% G/E at this time.  Due to the mundane weather and like yc, some are anticipating ratings to increase 2% higher.

Nearby basis values are still inverted, meaning stiff penalties possible if you are late delivering July contracts.  DON’T BE LATE!

Bloomberg Trader Bias:  Bullish 16% (12% LW), Bearish 48% (48% LW), Neutral 32% (36% LW)

LAST Monday’s Crop Progress:

US CONDITION: 62% G/E  and 62% LW  73% LY   STATE OF IL CONDITION: 47% G/E, 48% G/E LW( down 1% from LW)

US BLOOMING:  56% TW, 38%LW, 57% LY, and 56% AVG.  The State of IL BLOOMING: 56% TW, 33LW, 66% LY, and 61% AVG.

US POD SETTING:  17% TW, 6%LW, 18% LY, and 17% AVG.  The State of IL EMERGED: 16% TW, 2%LW, 22% LY, and 18% AVG.

 

WHEAT          

DOWN 10

Harvest progress has been helped along with good harvest weather.  Weakness in corn and beans pressured further.  In Sales,  104,350 MT wheat was sold to Taiwan for 15/16 delivery.  Year-to-date wheat export sales off 22%.  That compares at 257 mbu against 328 last year. The USDA is expecting an additional 11%, 95 mbu export increase.  The BA Exchange says wheat planting is 94% complete and leaves the planted area at 3.75 million ha.  NEXT Monday’s Crop Ratings for Spring wheat is expected to be up 1% from 70% G/E last week.  That too compares with 70% last year. 

We are still looking for feed grade homes for the 15′ crop. 

Bloomberg Trader Bias:  Bullish 12% (12% LW), Bearish 69% (48% LW), Neutral 19% (40% LW)

LAST Monday’s Crop Progress:

Winter Wheat Harvested: 75% TW, 65% LW, 74% LY, 74% AVG.      The State of IL Harvested:  91% TW,83% LW, 94% LY, and 97% AVG.