Written Commentary
Ag Market View for July 26.24
July 26, 2024
SOYBEANS
Soybeans traded both sides of Tuesday close. Overnight, Dalian soybean, soymeal, soyoil and palmoil traded lower. Sharp rally in corn triggered new buying. SX ended near 12.40. Range was 12.27-12.40. Today there is now sound fundamental news to suggest SX needs to trade over 12.50. South America weather is mostly favorable. US soybean export shipments and commit is well below last year. There is talk that this week’s US and China trade talks failed to bear any new export demand. US Phase 1 trade deal expires Dec 31. Weekly US soybean export sales are est near 1,250-2,000 mt vs 2,878 last week. There remains 17 mil US soybean acres yet to be harvested. Some still feel final US 2022 crop could be above USDA Oct guess and exports could drop 60 mil bu from USDA number. This could increase US carryout to near 415 mil bu vs USDA 320.
CORN
Corn futures rallied on new fund buying. CZ ended near 5.57. Range was 5.39-5.63. Some link the new buying to talk of higher nitrogen prices. Appears corn futures tend to follow nitrogen prices. Talk of lower supply could rally NH3 to near $1,200. Some feel this could push CH22 closer to 6.25. Weekly ethanol production was up 1 pct from last week and up 17 pct from last year. Stocks were down 1 pct from last week but up 1 pct from ly. Margins continue to improve. Some were adding 100 mil bu to corn ethanol use. Talk of US corn ethanol used for jet fuel could add another 300 mil bu corn use. Trade also thinks final US exports could be closer to 2,700 vs USDA 2,500. All that new demand could drop US 2021/22 carryout down below 1,000 mil bu. Weekly US corn export sales are estimated near 800-1,300 mt vs 1,273 last week. There remains 26 mil US corn acres yet to be harvested. Some see US 2002 corn crop near 15,300 and yield near 180.5. Total demand could be 15,690. This suggest a carryout near 1,495 if carryin is 1,243.
WHEAT
Wheat futures rallied led by Chicago. WZ ended near 7.60 with a range of 7.45-7.62. KWZ ended near 7.82 with a range of 7.71-7.86. MWZ ended near 10.21 with range 10.10- 10.32. Chicago was supported by lower US Dollar and higher corn prices. Two sided trade in KC. KC supported by talk farmers may apply less fertilizer to US 2022 HRW wheat crop that could lower US 2022 yields vs talk US wheat export prices are too high and US sales could remain slow. Weekly US export sales are estimated near 200-500 mt vs 362 last week. Chance for rains next week also offers resistance to KC. There was also talk that some N Africa and Middle East wheat buyers may be having payment problems. Iran could washout wheat vessels bought in October. Minneapolis wheat continues to traded over 10.00 due to low World milling wheat supplies. Some feel MWZ may be overbought and due for either correction or consolidation. Trade range of US 2021/22 wheat carryout is 550-640 vs USDA 580. Key will be final exports. Early guess for US 2022 wheat crop is 2,060 mil bu vs 1,646 this past year. Carryout is estimated near 880 mil bu.
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