Written Commentary
Ag Market View for July 26.24
July 26, 2024
Soybeans, soyoil, soymeal and wheat traded lower. July corn rallied late. US Fed comments today were hawkish.
SOYBEANS
Talk that recent high of SN near 16.00 had begun to ration demand continues to weigh on prices. SN dropped below 15.50 and tested 15.22 before ending near 15.41. Continued active China buying new crop US corn raised question of when will they buy US soybeans. Some feel in 2021/22 they could take more than 35 mmt from US they took this year. Still they need to export in the fall after this year’s corn program and before 2022 corn program. Managed funds were net sellers of 22,000 soybeans, 5,000 soymeal and 8,000 soyoil. Soyoil dropped on talk Argentina will increase soyoil exports for biofuel, lower India demand and talk recent high in futures may have lowered demand for biofuel. Talk that next 2 weeks and possibly 30 days US Midwest weather forecast suggest normal to above temps which should promote growth and normal rains. This continues to force weather premium out of futures.
CORN
July corn managed small gains on a late rally. Early on, Managed funds were net sellers of 10,000 contract. At the end of the day they were net buyers of 2,000. Most of the recent fund selling was due to the recent private guess of US 2021 corn acres near 96 million versus USDA 91. This has trump talk of higher China buying US corn and lower Brazil crop. Today, USDA announced another 1.36 mmt of US 2021/22 corn sold to China. This could bring sales to 9-10 mmt. Some still feel China could take 40 mmt all origin corn in 2021/22 versus 30 this year. Trade also could see final Brazil corn crop below 90 mmt. This could add 325 mil bu to US 2021/22 corn export. Near the highs, Trade was talking a US 2021/22 corn carryout near 1,200 versus USDA 1,502. Informa 96 million acres suggest a carryout near 1,900. Today one group estimated Brazil corn crop near 91 mmt vs USDA 102. Weekly US ethanol production was up 5 pct from last year and 55 pct from last year. Stocks were up slightly from last week but down 17 pct from last year. Margins improved. Crushers continue to bid up for corn and most look for higher domestic summer fuel demand. Weekly US old crop corn sales are est near -300-400 mt vs -113 last week. New crop is est near 3,000 to 4,500 mt versus 2,083 last week.
WHEAT
Wheat traded lower. Talk of better rains across US north plains and Canada prairie and continues rains across US south plains continued to weigh on prices. Talk that north Kansas 2021 wheat yields were highest in the 20 year history of the tour also weighed on prices. Higher US Dollar and fact US Fed minutes were hawkish and could move Dollar higher may push the Dollar higher also offered resistance. French wheat futures traded lower following lower US prices. Weekly US wheat export sales are expected to be near 150-350 mt vs 268 last week. WN ended near 6.79. Range was 6.71-6.99. KWN ended near 6.36. Range was 6.19 to 6.49. MWN ended near 6.97. Range was 6.85-7.14. USDA est World 2021/22 wheat trade near 202 mmt vs 199 this year. Russia 40 vs 39.5 ly, EU 33 vs 30, US 24 vs 26, Ukraine 20 vs 17, Canada 23.5 vs 30 and Austrália 20 vs 22.
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