COMMENTARY 8/1/18

Warmer starting tomorrow through Mon then cooler as a weak Canadian front dips South, then another 7-10 days of warmer again.  Some accums are expected Sat – Tue with with highest totals in store for MN and WI. AR, KS, and MO stay drier.

CORN

DOWN 7

Weekend showers are putting test weight in the kernel depth!  Trade concerns shrug off yesterday’s gains as US says putting additional tariffs in place is simpler than listening to China whine about their failing economy.   Stone was out with their (hearty) yield at 178.1 bpa and 14.562 Prod.  That compares with the current USDA at 174bpa and a 14.230.  Thursday is weekly Export Sales day and expected to range between 12 -24 mill with 12.4 needed per week to make USDA est.  Weekly  Eth Prod declined 10 K bpd to 1.064 mill, close to the average guess of 1.066 in a range of 1.05-1.08.  The UAC dropped its Russian Prod est to 11 mill tons, from 12.7.  The USDA had dropped their est from 15 to 12 on the Jul report.  ProAgro increased Ukraine’s Prod to a record 30.9 MMT (up from 26.9) and compares to 24.1 last year.

Mon’s Crop Progress:

US YC CONDITIONS:  72% G/E, 72% LW, and 61% LY

IL YC CONDITIONS:    80% G/E,   82% LW,  63% LY

 

BEANS              

DOWN 17

On second thought, let the Chinese waller in their squaller.  The White House ponders a higher tariff from 10% to 25% on $200 bill of Chinese goods.  Chinese manufacturing has hit an eight month low!!  Demand for US beans continues STRONG even though the Chinese have stopped (for now).  This afternoon was there was supposed to be a White House release of China info at 3pm.  Details slow to come.  NASS’s June crush was 169.6, that’s a half mill bu ABOVE the trade estimate. Sep/ June crush was 1.706 bill bu.  Tomorrow’s Export Sales are expected to be 6 – 18 mill with only negative 8.8 per week needed.

Crop Progress:
US YS CONDITIONS:  70% G/E, 70% LW, and 59% LY

IL YSB CONDITIONS:    75% G/E,   78% LW,  and 66% LY

 

WHEAT

UP 4

The market in the EU is higher and the Funds bought another 6,000 contracts.  Europe and surrounding areas continue to shrink.  Some think we could see additional reductions of another 12-15 MMT still to come!  Bulgaria’s crop is est at 5.5 MMT, a 7% decline.  Ukraine’s Ag Minister is estng a 22-23 MMT Prod, down from 26.1 last year and compares to the USDA’s Jul est of 25.5. Export Sales are expected to be 7 – 17 mill bu with 16 mill needed per week.  The take-away??  US wheat is QUICKLY becoming THE cheapest wheat in the WORLD.