CORN HIGHLIGHTS:

• Corn futures saw mixed trade on Friday to end the week. Front end demand concerns pressured the market as prices finished fractionally lower as prices consolidated for the 9th session in a row. For the week, Dec corn posted a 10-cent loss.
• The soft tone in old crop export sales this past week, and the potentially heavy front-end supply of corn kept pressure on front month contracts. Front end corn prices may be poised for selling pressure going into August as September Basis contracts will need to be priced, and producers look to move old crop corn to make room for this fall’s harvest.
• Ethanol production has been a bright spot in recent corn demand. Weekly production remains strong and with the recent rise in oil prices, margins remain friendly. With that combination, ethanol producers have room to bid up for corn on the cash market, stockpiling for future ethanol production. Ethanol margins could be squeezed as crude oil prices dropped 3% today as the crude oil market saw long contract liquidation to end the week.
• Weather forecasts going into the end of July remain supportive for crop development. Temperatures are to remain cool with moisture forecasted for many regions of the corn belt. Weather concerns regarding the corn market are now mostly past the point of concern unless there are extremes.

SOYBEAN HIGHLIGHTS:

• Soybean prices faded midday and settled lower after trading higher in the overnight session, with selling pressure coming from declining meal and oil prices. December bean oil retreated after hitting overhead resistance near key moving averages just below 45.00 cents, while December meal uncovered selling just below yesterday’s high.
• The USDA reported another flash sale indicating that private exporters sold another 105,000 mt of soybean meal to unknown destinations. The sale had little effect on the market as soybean meal quickly sold off upon the market’s reopening of the day session.
• With crush margins firm, the nearby August contract continues to see support from solid demand as buyers reach for hard to get supplies, still held by strong hands. While new crop contracts continue to see overhead resistance with a non-threatening weather outlook and the prospect of a large crop this fall.
• Later today the CFTC will release its updated Commitment of Traders report, showing fund positions as of Tuesday, July 16. With the weak price action seen this week, it is anticipated that managed funds added to their extensive net short position, potentially bringing it to about 190,000 contracts.

WHEAT HIGHLIGHTS:

• While wheat did close in positive territory today, all three categories finished the session well below daily highs. Early strength came from Paris milling wheat futures; front month September gained 8.75 Euros per ton, filling the chart gap from earlier in the week by a long shot. This may be tied to French wheat crop ratings, which declined 5% to 52% good to excellent with 14% of the crop harvested. This is the slowest harvest pace since 2021, and last year at this time the crop was rated much more favorably at 80% good to excellent.
• IKAR is reported to have lowered their estimate of Russian grain production by 1.5 mmt to 128 mmt. Additionally, they reduced Russian grain exports by 0.5 mmt to 55 mmt. On a related note, Ukraine’s grain harvest so far has reached 13.8 mmt, with 10.3 mmt of that being wheat.
• A warmer and drier forecast for the US northern plains, as well as parts of the Canadian prairies, is causing some concern that spring wheat yields may be affected. This helped Minneapolis futures to rally today; they closed as today’s upside leader in the wheat complex. In addition, 12% of spring wheat acres are said to be in drought as of July 16, a jump from just 7% the week prior.
• According to the Buenos Aires Grain Exchange, planting of the 24/25 wheat crop in Argentina has advanced from 92.9% to 95% complete. The planted area estimate was unchanged at 6.3 million hectares. For reference, last year 5.9 million hectares of wheat were planted.

DAIRY HIGHLIGHTS:

• Class III futures gave back some of Thursday’s gains but overall, the 2024 Class III average posted a weekly gain of 14 cents to close at $18.53/cwt.
• Spot cheese was unchanged heading into the weekend at $1.88875/lb while whey improved 0.75 cents to $0.5175/lb.
• Class IV futures were unchanged to slightly weaker on Friday led by the November contract which fell 9 cents to $21.27/cwt.
• Spot butter saw similar results as Thursday losing 3 cents on 20 loads traded to close at $3.0750/lb. Spot powder gained 0.75 cents to close at $1.1975/lb to end the week.

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Author

Brandon Doherty