COMMENTARY 7/25/16

Widespread coverage of above avg rain is forecast for most of the Midwest the next 10 days as an upper level high stays too far S. The excessive heat is breaking and will continue to weaken, ending Thurs, followed by some cooler temps.  Accum of of 1″ to 2″ can be expected and some significant heat may return once into Aug.

St Louis river level DROPPING ~ at 18.7′ and forecast 15.5 by 7/30.  

CORN

OLD ~ UNCHANGED    NEW ~ UNCHANGED

More weekend rain allows the Central Belt to avoid the heat stress and the USDA may raise its’ yield est in Aug.  Export Inspections were 51.4 vs expectations of 45-55 and 48.6 per week needed. Significant volumes went to Saudi Arabia and Israel.  Expect a rebound in export competition since Safras sees the Brazil safrinha crop up 37% (8% more acres and normal yields).  This means a 650 mill bu larger crop that would go for export.  Argentina’s Attaché expects 16/17 acres to increase 30%, or about 750,000 acres MORE than the last July WASDE.

Monday’s

US CONDITIONS:  76% G/E THIS WEEK,  76%  LAST WEEK, 70% LAST YEAR

IL CONDITIONS:  82% G/E THIS WEEK, 80% LAST WEEK

US SILKING: 79% THIS WEEK,  56 % LAST WEEK, 71% LAST YEAR, and 70% AVG

IL SILKING:  90% THIS WEEK,  77 % LAST WEEK,  85% LAST YEAR, and 86% AVG

US DOUGH: 13% THIS WEEK,  NA % LAST WEEK, 12% LAST YEAR, and 13% AVG

IL DOUGH:  18% THIS WEEK,  5 % LAST WEEK,  28% LAST YEAR, and 23% AVG

BEANS     

OLD ~ DOWN 23       NEW~ DOWN 22

Favorable weather and the market ignored Inspections. Monday’s Inspections were 25.7 vs expectations of 15-  25 with 11 per week needed.  China took 15.1 mill bu.  China is still planning to offer 600 K MT of 2012, 2013 soybean reserves up for auction July 29.  The EU Commission approved use of Dicamba GMO beans.  Crop Ratings for G/E was thought to be unchanged to 1 lower from 71% last week and vs 62% a year ago.  See actuals below.

Monday’s

US CROP CONDITION: 71% G/E THIS WEEK,   71% LAST WEEK, and 62% LAST YEAR

IL CROP CONDITION: 77% G/E THIS WEEK, 76% LAST WEEK

US BLOOMING: 76% THIS WEEK, 60% LAST WEEK, 67% LAST YEAR and 71% AVG

IL BLOOMING: 76%  THIS WEEK, 60 % LAST WEEK, 67% LAST YEAR, and 71% AVG

US SETTING PODS: 35% THIS WEEK,  18 % LAST WEEK, 29% LAST YEAR and 26% AVG

IL SETTING PODS: 33%  THIS WEEK, 15 % LAST WEEK, 27% LAST YEAR, and 27% AVG

 

 WHEAT          

UP 4

Futures managed to pinch higher to start the week after trading lower with active volume.  Too much rain and cool temps have the French soft wheat crop shrinking to a 13-year low with additional quality concerns to boot.  Our Export Inspections were at the top end of expectations at 20.2 mill bu vs thoughts of 15-22 expected and 17.6 per week needed.  Japan took 6.5 mill bu of that total.  Russian harvest is advancing as 26.7 MMT has been harvested 40% more than last year.   HRW protein levels last week were at 11.2%, down from 12.3% a year ago.  Storage many not be just a problem in parts of the US as W Australia grain handler, CBH expects 14-16 MMT crop and is carrying over a larger than normal 1.8 MMT of inventory and having quality concerns as well.  S. Wheat Associates reports harvest

Monday’s

US WINTER WHEAT HARVESTED:  83% THIS WEEK, 76% LAST WEEK, 82% LAST YEAR, and 79% AVG

IL WINTER WHEAT HARVESTED:  99% THIS WEEK, 97% LAST WEEK, 94% LAST YEAR, and 97% AVG