COMMENTARY 7/27/15

Great weekend weather, a Chinese stock market selloff, and improved growing conditions, forced a bloodletting.

**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 +26.1 and forecast  to be 23.8 by  8/1.  (ONCE AGAIN BELOW FLOOD STAGE)

Very warm/hot weather thru Wed then seasonable temps, followed by a period of cool and dry.  This could potentially leaving a few areas in need of rain some 10 to 14 days out.

CORN

DOWN 20

Great coverage from weekend rains for hot/dry shallow rooted plants was a savior!  This AFTERNOON’S Crop Conditions report was expected to hold steady with some improvement possible.  See below for actuals!  Also a dinger today, was the Chinese stock market melt-down.  If THAT wasn’t BAD enough, it COULD lead to reduced corn exports to China. – OR, it could mean reduced Chinese bean demand.  -OR, could mean lower corn prices for US corn.  Last week there were three private yield estimates ranging from 163-165 range.  Corn Export Inspections were strong but didn’t help at 43.6 vs expectations of 31-40. Some 21 mbu of that total went to Japan.  Milo Inspections  were 6.3 vs 6.6 LW and 7.2/wk needed.  Rabobank maintains the US yield est at163 bpa and raises their price forecast 20-30 cents to approx. $3.90.  Does this mean you should get some $4.00 corn on the books?  Allendale is dismissing excessive summer rains, placing their yield est at 165.0.   Morgan Stanley’s yield est sits at 164.6 with a potential of 166.7bpa.

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

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

Today’s Crop Progress:

US CONDITION: 70% G/E , 69% LW  75% LY   STATE OF IL CONDITION: 57% G/E 55% LW (UP 2% from LW)

US SILKING:   78% TW,  55% LW, 75% LY, and 77% AVG.  The State of IL SILKING:  89% TW, 75% LW, 92% LY, and 91% AVG.

US DOUGH:   14% TW,  na % LW, 15% LY, and 17% AVG.  The State of IL DOUGH:  32% TW, 17% LW, 24% LY, and 30% AVG.

 

BEANS     

OLD ~DOWN 30      NEW ~ DOWN 32

Swell weather, and the Shanghia stock market sell off and implications for Chinese protein demand.  Export Inspections too were weak at 4.4 vs expectations of 4 – 9 mill bu.   Brazil has begun exporting beans from The Barra dos Coqueiros terminal in Sergipe in the NE part of the county.  That should provide significant ocean freight savings to potential buyers.  Back in the US, Rabobank  has raised their price estimate some 70 cents to $9.90 and $9.60 for the avg price of ysb’s,  citing tighter old crop supplies and yield uncertainty for the new crop, which is estimated at currently at 43.5 bpa.  Time/weather will tell the story.  This afternoon’s Crop Conditions Report was steady to improved and can be seen below.

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

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

 

Today’s Crop Progress:

US CONDITION: 62% G/E  and 62% LW  71% LY   STATE OF IL CONDITION: 49% G/E, 47% G/E LW( UP 2% from LW)

US BLOOMING:  71% TW, 56%LW, 74% LY, and 72% AVG.  The State of IL BLOOMING: 72% TW, 56LW, 81% LY, and 77% AVG.

US POD SETTING:  34% TW, 17%LW, 35% LY, and 31% AVG.  The State of IL EMERGED: 31% TW, 16%LW, 41% LY, and 34% AVG.

 

WHEAT          

DOWN 9

Carry-over pressure above.  Export Inspections were very good at 16.1 vs 7-15 with 19.2 per week needed. We are still working on feed grade homes for the 15′ crop. 

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

Today’s Crop Progress:

Winter Wheat Harvested: 85% TW, 75% LW, 82% LY, 80% AVG.      The State of IL Harvested:  95% TW,91% LW, 99% LY, and 99% AVG.