Written Commentary
Ag Market View for July 26.24
July 26, 2024
MORNING AG OUTLOOK
USDA report day. Month end. Grains are mixed. SK is unch and near 14.74. SMK is near 456.4. BOK is near 54.54. CK is unch and near 6.49. WK is down 4 cents and near 6.87. KWK is down 4 cents and near 8.67. MWK is down 7 cents and near 8.72. US stocks are higher. US Dollar is higher. Crude is mixed and near $75 resistance. Reduced fear of additional Bank crisis and talk Fed may slow rate increase continues to support equites.
Despite good weekly US corn export sales and another 178 mt US corn sold to China, corn futures have dropped from 6.55 CK high. Futures inverse and strong basis suggest US corn pipeline supply is tight. Key today is USDA est of US 2023 acres and March 1 stocks. Some fear that USDA could find stocks and acres vs the trade guess. Still data is a month old and could be changes especially with Midwest and north plains wet. There was no Argentina corn peso deal announced. Argentina corn harvest 7 pct vs 17 ave with early yields 30-60 bpa. Brazil corn basis continues to drop vs US.
SN is near 14.74. Dalian soybean, palmoil and soyoil prices were higher. Soymeal was lower. EU rapeseed prices were lower on talk of higher 2023 supplies. EU est 2023 rapeseed, sunseed and soybean crop at 33.5 mmt or up 7 pct vs ly. Canada higher on concern of wet and cold weather lowering supply. Argentina announced soya peso deal to encourage farmer selling. Some feel Argentina farmers could have 6 mmt of 2021 crop supply unsold and 8 mmt 2022. 2023 crop 25 mmt vs USDA 33. 30 pct of crop is mature with zero harvested. Key today is USDA est of US 2023 acres and March 1 stocks. Bears fear that USDA could est stocks and acres lower vs the trade guess.
Wheat futures have turned lower. Still uncertainty over Russia price policy. Russia trying to increase price to farmers but could actually set old crop price near $275 and new $250. Wet US north plains and Canada weather and dry US HRW is supportive. KWK-WK spread hit new high near +179. Matif wheat lower on higher Euro and est 2023/24 end stocks at 22 mmt vs 7 ty.
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