Written Commentary
Ag Market View for July 26.24
July 26, 2024
Grains markets were choppy and volatile. Early losses linked to talk of increase US imports and US Fed keeping rates low. US Dollar was lower. Crude and copper managed late gains.
SOYBEANS
Grains markets were choppy and volatile. Early losses linked to talk 0f increase US imports and US Fed keeping rates low. Talk of tight US 2020/21 supplies rallied May contracts before deliveries. Late selloff linked to favorable US weather and increasing US debt. SK traded near 15.57. Range was 15.24-15.89. Trade looking for no deliveries. SN traded near 15.13. Range was 14.90-15.44. SX traded near 13.28. Range was 13.15-13.48. SMK is near 421.3. China soymeal values turned lower. Talk of SA soybean and soymeal imports offered resistance. BOK traded limit up on concern of tight US supplies. Weekly US old crop soybean export sales are est near -100-200 mt vs 64 last week. There was talk of China cancelling Brazil sales. New crop sales are est near 200-500 mt vs 315 last week. Talk by one grain CEO of higher US 2021 soybean acres than USDA March est offered resistance to SX.
May soyoil futures minus July soyoil futures spread
CORN
Corn futures were mixed. Liquidation of May open interest kept trade choppy and volatile. Higher US cash basis offers support to May. Talk of increase corn imports from Argentina and French wheat for feeding offered resistance. EIA weekly ethanol production was slightly below expectations but above last year. US ethanol stocks declined and the lowest level since late October. The current ethanol production pace is in line with USDA’s 2020-21 corn grind for ethanol estimate of 4,975 mil bu. Tight nearby cash corn basis could continue to limit the downside in corn futures. Dryness in Brazil’s could continue to deteriorate corn yield prospects. A favorable US corn planting pace and prospects for good crop development could bring increased selling into December until increased dryness concerns develop. Talk by one grain CEO of higher US 2021 corn acres than USDA March est weighed on CZ. Weekly US old crop corn export sales are est near 400-1,000 mt vs 387 last week. New crop sales are est near 100-600 mt vs 325 last week. CK ended near 6.86. Range was 6.76-7.20. CN ended near 6.44. Range was 6.29-6.70. CZ ended near 5.46. Range was 5.37-5.63.
May corn futures minus July corn futures spread
WHEAT
WK ended down 8 cents and near 7.25. Range was 7.13-7.43. KWK ended down 16 cents and near 6.88. Range was 6.82-7.11. MWK is ended down 15 cents and near 7.42. Range was 7.16-7.45. Managed funds were net sellers of 6,000 SRW wheat. Managed funds are estimated to be net long 39,000 wheat. World prices are lower than US and could limit US exports. Weekly US wheat exports are estimated near 0-300 mt vs 240 last week. New crop sales are est near 200-450 mt vs 373 last week. This weeks Egypt tender cancellation due to high prices offered resistance. This weeks rains are expected across the east part of US south plains, MO, south IL and IN. Over the next 2 weeks US NW Midwest rains could be less than normal. US domestic flour buyers are covered for May and June, July-Sep could be near 30-40 pct. Oct-Des is less than 10 pct. Wheat will follow corn and World 2021 weather.
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