TFM Morning Update 07-16-2024

CORN

Corn is trading higher and at the upper end of its near six cent range in the December contract this morning as it recovers some of its losses from yesterday.
The USDA released its weekly crop progress report yesterday afternoon, which showed the corn crop’s good to excellent condition unchanged at 68% from last week and compares to 57% G/E from last year. 41% of the crop is silking versus the 5-year average of 32%.
US export and domestic basis remains firm as processors and exporters reach for supplies to keep their pipelines full. Weekly export inspections were 42 mb and are 31% ahead of last year’s pace. This continues to support the front end of the corn market as September corn gains on December.
Funds were active sellers in yesterday’s market action, adding an estimated 14,000 corn futures contracts to their record short position. They are now estimated to be net short 375,000 contracts.

The soybean market is firm this morning as traders cover some short positions following yesterday’s sharp selloff. Soybean meal is only slightly higher, while bean oil is moderately higher.
The USDA reported in its weekly crop progress report, that the soybean crop’s good to excellent rating remained steady at 68% from last week and compares to 55% G/E last year. 51% of the crop is blooming versus the 5-year average of 44%.
The NOPA crush report showed 175.6 mb of soybeans were crushed in June, below expectations of 178 mb, but still above last year’s 165 mb. Soybean oil stocks also came in below expectations at 1.622 billion pounds, which has given support to soybean oil.
Funds were active in the soybean market yesterday, selling an estimated 11,000 soybean contracts. Managed funds are now estimated to be short 183,000 contracts.

All three classes of wheat are showing small gains across most contracts as prices attempt to recover from yesterday’s lower trade and Friday’s bearish supply outlook.
The USDA showed in yesterday afternoon’s crop progress report that winter wheat harvest has maintained its quick pace and is now 71% complete, 9% ahead of the 5-year average of 62%. The spring wheat crop condition gained 2% in the good to excellent categories to 77%, from last week’s 75%, with 76% of the crop headed.
Black Sea export prices remain the cheapest on the world market with Russian prices not far behind, as they have reportedly fallen to $218 per mt FOB, which continues to weigh on prices. Global demand for the August time frame remains weak.
Like corn and soybeans, managed funds were active sellers in Chicago wheat in yesterday’s trade, selling an estimated 6,000 contracts, and brings their estimated net short position to 85,000 contracts.

Scott Masters