Written Commentary
Ag Market View for July 26.24
July 26, 2024
SOYBEANS
The soybean complex was higher across the board with soybeans up $.14 – $.18, meal $3 – $5 higher, while oil was up 90 – 95. It was an inside day on the charts for Nov-23 soybeans as prices rebounded back above the 50 day MA at $13.20. First resistance is at Friday’s high at $13.38. Good support rests between $12.82 – $12.90. Export inspections at 11 mil. bu. were above expectations and in line with the amount needed per week to reach the USDA export forecast of 1.980 bil. bu. In addition the USDA announced the sale of 416k tons (15 mil. bu.) of new crop soybeans to an unknown buyer. NOPA crush at 11 AM CST tomorrow. NOPA members are expected to have crushed 171 mil. bu. in July, up from 165 mil. in June and up from 170.2 mil. in July-22. The end of the month oil stocks are expected to be 1.687 bil. lbs., near steady from June and July-22. Since 1990 the USDA has lowered both their production and yield forecast in the August report 17 times. Their final production forecast was above the Aug. est. 13 times, while below it only 6 times. Unlike corn, US soybean ending stocks and stocks/use ratio for 2023/24 are forecast to remain historically tight.
CORN
Dec-23 held support at last month’s low of $4.81, recovering to close $.00 ½ higher. The current system that is bringing good rains to WI, MI and far northern IL the next few days will provide lighter coverage and overall totals to the rest of the eastern corn belt. Little to no rain is expected across much of the central and western corn belts the balance of the week as temperatures begin to warm to much above normal readings by this weekend. The longevity of the expected hot/dry pattern will be closely monitored by the trade as weather premium was inserted back into soybeans today. Export inspections at 16 mil. bu. were in line with expectations, however well below the 31 mil. bu. needed per week to reach the revised USDA export forecast of 1.625 bil. bu. AgRural estimates Brazil’s 2nd crop harvest has reached 71% as of Aug. 10th, below the YA pace of 85%. Since 1990 the USDA has lowered both their production and yield forecast in the August report 15 times. The final production forecast was above the Aug. est. 9 times, while below it 6 times.
WHEAT
While wheat prices were lower across all 3 classes today they did manage to close well off session lows. Chicago finished $.12 – $.14 lower while KC and MGEX were down $.05 – $.10. Both Dec-23 Chicago and KC reached their lowest price level since May. IKAR reported that Russian Black Sea wheat export prices ended last week at $250/mt, up $2 from the previous week. They have also suggested Russia is considering raising the floor price $20 mt to $260/mt. IKAR also raised their Russian wheat production forecast to 89.5 mmt, well above the USDA est. of 85 mmt. While tensions in the Black Sea region remain high, so far it hasn’t prevented Russia from dominating global wheat trade. US wheat export inspections were a MY low at only 7 mil. bu., below expectations and roughly half of the level needed to reach the downwardly revised USDA forecast of 700 mil. bu. While both HRW and SRW stocks/use are forecast to see a bump higher this year, HRS stocks/us is expected to fall to a 10 year low.
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