CORN HIGHLIGHTS:

• Corn futures saw short covering in an oversold market to finish with double-digit gains on Thursday. With both weakness in the soybean and wheat trade overall, corn futures were likely the backside of that trade. The market saw a risk off mentality overall, and that meant covering short corn positions.
• Chinese corn prices have been on the rise since April due to adverse weather, and rumors of China purchasing Brazilian corn for November delivery has helped support global corn prices, aiding the short covering rally.
• Weather will stay as a focus. The short-term weather forecast is showing some concerns about the northwestern Corn Belt staying on the dry side, bringing concerns regarding overall crop yield.
• A potential forecast for cooler temperatures next week should only help those areas that did receive recent rainfall, as corn looks to enter the pollination stage in the central Corn Belt.
• The USDA will release weekly corn export sales numbers on Friday morning. Expectations are for old crop and new crop sales to range from 0-500,000 MT each respectively, as export demand is still lacking overall.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day lower, along with both soybean meal and oil after futures became overbought during the past week, and weather forecasts turn wetter in the South over the next week.
• Brazil’s export group, ANEC, reported that June soy exports rose to 9.44 mmt, which compares with 7 mmt in June of last year. With Brazil taking so much control of the soy export market, US export remains very sluggish.
• The 10-day forecast is showing rain for Iowa, northern Illinois, the northern Plains, and Great Lakes regions. The northern areas are the hardest pressed for moisture right now and these rains could provide some needed relief.
• Soy conditions are currently the worst rated for this time of year since 2012 at only 50% good to excellent, falling 1% from the previous week. The decline in ratings came after a week of beneficial rain, so it is unknown what ratings will look like after this week’s rain amounts which are forecasted to be decent but better in the South.

WHEAT HIGHLIGHTS:

• Despite the uncertainty in the Black Sea, US wheat futures closed mostly lower today. Not only are there worries about the sabotage of a Ukrainian nuclear power plant, but overnight Russian missile strikes hit the city of Lviv. Russia is also said to be taking back parts of eastern Ukraine.
• Better than expected yields of SRW wheat in Illinois may have put pressure on the Chicago market today. Higher yields of French wheat also offered resistance. Reportedly, that crop yield is 5% above the 10-year average.
• Cheap Russian wheat exports continue to act as the anchor for US futures. Russian FOB values are said to be as low as $232 per metric ton. Additionally, one estimate of Russia’s wheat crop (Agritel) was increased by 2.5 mmt to 85.7 mmt. For reference, the USDA is using a figure of 85 mmt.
• Tunisia is reported to have purchased 100,000 mt of wheat from Russia. The US was not totally left on the sidelines, however. Taiwan flour millers purchased 56,000 mt of US wheat.
• A Canadian port strike in British Columbia could eventually slow grain movement there, although it is not a major concern so far.

DAIRY HIGHLIGHTS:

• August Class III futures dropped 9 cents to close at $14.37, just above the low close for the move from June 27th at $14.35 on the second month continuous.
• Spot cheese was 1.25 cents higher on 35 loads of barrels and 5 loads of blocks traded. Spot whey closed at a new all-time low of $0.23/lb.
• Action for Class IV futures was mixed but the nearby July and August contracts were up 7 and 4 cents, respectively.
• The spot trade was mixed with spot butter hitting a new 2023 high at $2.4775/lb, while powder hit a new low for the year at $1.1075/lb.

Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of the National Futures Association. Stewart-Peterson Inc. is a publishing company. SP Risk Services LLC is an insurance agency. A customer may have relationships with all three companies. TFM Market Updates is a service of Stewart-Peterson Inc. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.

Author

John Heinberg