Written Commentary
Ag Market View for July 26.24
July 26, 2024
CORN
Prices were down $.04 – $.05 as weak demand continues to weigh on corn valuations. Dec-23 finally broke below support at $4.73 ½. Next support is $4.55. US harvest is pushing further north with reported yields highly variable. Last week Money managers were net sellers of nearly 41k contracts of corn extending their short position to 134,909 contracts, their largest short position since Aug-2020. Export inspections at 25 mil. bu. were in line with expectations. YTD inspections at 50 mil. bu. are up 11% from YA, vs. the USDA forecast of up 23%. Chinese customs report Aug-23 imports at 1.2 mmt, down 33% from Aug-22. In the first 8 months of 2023 imports have reached 14.9 mmt, down 12% from YA.
SOYBEANS
The soybean complex was lower across the board with beans down $.20 – $.24, meal was $3 – $5 lower, while oil was down 100 – 130. Better prospects for rain in west central Brazil by month end along with less war premium fueled the lower trade. Nov-23 beans traded to their lowest level in a month with next support being the 100 day MA at $13.04. Also a new monthly low for Oct-23 meal, next support is the Aug-23 low at $383. Oct-23 oil violated support at the 50 day MA, next support is the Sept low at 60.05. The USDA announced the sale of 123k tons (4.5 mil. bu.) of soybeans to China. Last week MM’s were net sellers across the board in the soybean complex as they sold 9k soybeans, 14.3k oil, and 2.9k in meal. In total MM’s remain net long 176,882 contracts in the soy complex. Export inspections at 14 mil. bu. were in line with expectations. YTD inspections at 28 mil. are down 16% from YA, vs. the USDA forecast of down 10%. Friday’s weaker than expected crush data, an improved weather forecast for SA along with uninspiring export data all contributed to today’s weak price action.
WHEAT
Prices were $.10 – $.15 lower across all 3 classes today. So far 5 vessels have left Ukrainian ports in Odessa while 2 more have arrived in the port of Chernomorsk this weekend after traveling along the “humanitarian corridor”. These vessels are expected to load out 20k mt of grain for shipment to Africa and China. Ukrainian Pres. Zelenskiy is expected in Washington DC later this week with plans to visit Pres. Biden along with members of both houses of Congress. Pres. Biden is expected to reaffirm the US commitment to Ukraine’s democracy. Support for Chicago Dec-23 comes in at last week’s contract low at $5.70 with resistance at Friday’s high of $6.07 ½. Support/resistance levels for Dec-23 KC are $7.09 and $7.48 ½. Support/resistance levels for Dec-23 MGEX are $7.57 and $7.91. Export inspections at 13.5 mil. bu. were in line with expectations. YTD inspections at 188 mil. are down 29% from YA, vs. the USDA forecast of down 8%. Last week MM’s were sellers of 5.5k contracts of Chicago wheat and 3.3k of KC wheat extending their short positions to 84,139 and 13,148 contracts respectively. The MM’s short position in KC wheat is the largest since Aug-2020. Algeria’s state grain buyer has issued a tender for milling grade wheat and barley which is expected to close tomorrow Sept. 19th. The grain is for Nov/Dec shipment. Chinese wheat imports for Aug-23 were 840k mt up 58% from Aug-22. YTD imports have reached 9.56 mmt, up 53% from YA.
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