Yesterday’s closes in grains were well off of the daily lows, and prices are higher at midday today. This signals support at these lower levels.
The debt ceiling deal was passed in the US House and is now moving onto the Senate, potentially offering some support to commodities.
July corn on Brazil’s Bovespa Exchange was lower again, around the equivalent of $4.45 per bushel. This is likely in anticipation of a record safrinha crop and is close to the lowest level in two years.
Sales of corn by Argentina’s farmers total 12.3 mmt to date, compared with 25.8 mmt at this time last year.
On China’s Dalian Exchange, July soybeans hit a new low – the equivalent of $14.47 per bushel. This takes out the previous close of $14.53 (equivalent).
Soybean meal has been trending lower, but is sharply higher at midday – this is supporting soybean futures.
Crude oil has recently been under pressure and is currently below $70 per barrel. This is likely on concern about global economics, especially with China’s economy said to be slowing. This also has been pressuring soybean oil, but both commodities are higher at midday today.
Chinese crush margins are turning negative, which could lead to a slowdown in future purchases of soybeans.
The western prairies in Canada have recently seen beneficial rains to help their wheat crop, and over the next week or so there will be widespread rain in Saskatchewan and western Alberta.
Spain is experiencing drought, but elsewhere in Europe and the Black Sea, wheat crop conditions are favorable. Some of Russia’s spring wheat areas remain dry, however.
Recent heavy rains in China’s wheat growing regions could reduce quality of that crop. Therefore, they may use more wheat for feed.
This morning, there were flash flood warnings in the Texas panhandle area. The wheat crop in this area was already struggling and this may further complicate the problems there.
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