Corn prices battle back regaining some of last weeks losses

September corn futures added 26-1/2 cents this week to close at 556. New crop December futures added 35 cents this week to close at 552. Rains fell across the Midwest this week as corn in many areas pushed into and through the pollination phase. Corn fields along the Iowa/Minnesota border extending into South Dakota stood the most to gain from this week’s rains as this remains the most drought-stricken part of the corn belt. Although continued rains will be needed in these areas, producers have reported being pleasantly surprised with how well the corn crop looks to be holding up admits the deficit of precipitation since planting.
Corn futures found resistance this week from slow export sales despite talk of lower South American exportable supplies. Old crop 2020/21 export sales last week came in in the lighter end of expectations due much in part to a canceled cargo by China. Sales last week for old crop only totaled 5.5 million bushels, sales need to average 8.5 million bushels per week to reach the USDA estimate of 2.85 billion bushels. New crop 2021/22 sales were also weak coming in at just 133,000 tons, below the lowest guess prior to the report.

Soybeans post nice gains this week

August soybean futures added 75-1/2 cents this week to close at 1454-3/4. New crop November futures added 62-1/2 cents this week to close at 1391-3/4. NOPA US crush for June came in at 152.41 million bushels, down 9% from June of 2020. This was the smallest monthly crush volume since June 2019 and over 3 million bushels below the lowest pre-report trade estimate. Reuters reported that tightening supplies and rising prices for beans prompted processors to schedule needed maintenance downtime, some of it lengthier than normal after COVID-19 pandemic restrictions disrupted that work last summer, analysts said.
There have been just two daily sale announcements so far for the soybean complex in July. Both of the announcements were to Mexico and were smaller sales. Mid to late July is generally when China begins to book more US soybean cargos. China bought 1.1 million tons last month but have otherwise been quiet. Elevated prices and a large soybean crop out of Brazil may have an effect on sales this year. With a lack of data coming out China this year many are left wondering how badly China needs soybeans or how plentiful stocks have become.

Wheat prices rally on tightening supply

September CBOT wheat futures added 77-1/2 cents this week to close at 692-1/2. September KC wheat futures added 57-1/2 cents this week to close at 651-1/2. September spring wheat futures added 103 cents this week to close into a new contract high at 917-1/4. The USDA confirmed the sale of 134,000 tons of US soft red winter wheat to China for the 2021/22 marketing year which started on June 1st. This sale announcement spurred a continued rally in all three wheats. While the winter wheats appear to be moving higher on smaller than expected ending stocks which were reported Monday, spring wheat continued its march higher due to the ongoing drought concerns. The end of July appears to be turning warmer and drier for the Dakotas and Canadian prairie as compared to the start of July. What little hope was left for saving this struggling spring wheat crop has all but vanished given this latest two-week outlook. Spring wheats push and close above $9/bu this week was rather significant technically. This close exceeds the market highs from 2017 and pushed the market into levels not seen since late 2012.

Milk prices correct lower

The milk market had a pretty up-and-down week of trade this week with quite a bit of activity in the spot markets. The spot cheese trade was bid 3.50c higher on Monday and 1.25c higher on Tuesday before taking a turn for the worse. The market proceeded to fall 17.25c over the next three sessions as sellers took over. By week’s end, cheese fell 12.50c this week and closed at $1.5275/lb. The rest of the spot markets were actually stronger this week. Whey picked up 3c to $0.5375/lb while butter and powder each added 0.25c to $1.6775/lb and $1.2525/lb, respectively. The spot market trade dictated price movement in the futures, as there wasn’t much news this week. The second and third month class III futures posted limit down moves on Thursday and August milk was down a total of 76c by week’s end. The market is trading choppy and fundamentals remain mixed at this time.