CORN HIGHLIGHTS:

• Selling pressure returned to the corn market to end the week, influenced by weakness across the grain markets and weather models forecasting better rain potential through the weekend. Dec corn finished 1/4 cent lower on the week, as prices consolidated this week around the $5.00 level.
• The USDA weekly export sales are still disappointing overall. The USDA announced new sales of 251,700 MT of old crop and 418,000 MT of new crop sales last week. Weekly exports were 707,500 MT, down 17% from last week and 24% from the four-week average.
• The USDA announced a flash sale of corn to Mexico this morning. Mexico bought 180,000 MT of corn, of which 135,000 MT was for new crop and 45,000 MT for old crop.
• Brazil shipped just over 1 MMT of corn in the month of June, but US prices continue to struggle on talk of China buying Brazilian corn as the window for Brazil corn exports is about to rally to its peak over the next few months.
• Long-range forecasts limit corn market rallies as 6-10 day and 8-14 day outlook forecasts from the NOAA are staying cooler and wetter than average.

SOYBEAN HIGHLIGHTS:

• An outlook for rain and cool temperatures for much of the northern and central Midwest in the 6-10 day forecast led the soybean complex lower, with the hope of reduced crop stress and some much needed moisture.
• The area of the US soybean crop that is in drought areas dropped 3% to 60%. While this is still a significant area, given the recent rain throughout the Corn Belt, it is expected to drop further.
• Weekly Export sales came in within expectations but toward the low end, with net sales of 6.9 mb for 22/23, down 17% from last week’s report and 45% below the 4-week average. On the other hand, 23/24 sales came in above expectations at a friendly 21.8 mb.
• According to Brazil’s grain exporters’ association Anec, Brazil is expected to export 9.4 mil metric tons of soybeans in July, which is down from June’s 13.9 mt total. For the year, it’s expected that the country may export a total of 96.3 mil mt, an increase of 17-18 mmt over last year’s total.
• According to OilWorld, an analytical agency based in Germany, world biodiesel production is estimated to grow 8% this year. Largely due to increases in the US with soybean oil being the primary feedstock, and Indonesia where palm oil is primarily used. The increased use of both feedstocks is supportive to bean oil and soybeans to maintain current world supplies.
• China’s Shanghai Securities News stated that the country’s sow herd shrank by 1.68% in June. This being the largest decline in months, suggests that farmers are culling more and more of their sows to cut losses, further reducing their feed demand.

WHEAT HIGHLIGHTS:

• Despite a sharp drop in the US Dollar today, all three classes of US wheat futures posted losses, and despite the lowest US wheat stocks in 16 years, which should also offer support, the wheat market looks weak.
• The USDA reported an increase of 14.9 mb of wheat export sales for 23/24 and a decrease of 0.1 mb for 24/25.
• Better-than-expected yields of French wheat are weighing on both US and Paris futures. So far, the French crop is reported to be about 10% harvested.
• A meeting between leaders of Ukraine and Turkey to discuss an extension of the Black Sea grain deal took place Friday. They reportedly also discussed a prisoner swap and efforts to end the war. This comes despite Russia insisting they will not extend the agreement that ends on July 17.
• From a technical perspective, Chicago wheat futures are at or near oversold levels on daily stochastics. This could mean that a technical correction to the upside is due.

DAIRY HIGHLIGHTS:

• Spot cheese found plenty of buyers this week and the active purchasing worked prices higher in 3/4 trading days this week.
• Spot butter remains the darling of the spot markets and finished at $2.48/lb after Friday’s trade, a high price for 2023.
• The Dairy Products report yesterday showed butter and whey production higher, while total cheese production and powder was lower, on a year-over-year basis for May.
• US dairy cow culling for the week ending June 24th, up 11.1% from the same week last year.

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Author

Bryan Doherty