Two-Sided Trade Leaning Lower

MORNING AG OUTLOOK

Two sided trade across the Ag space overnight with prices leaning lower ahead of this morning’s weekly export sales data.  Price appreciation in the short term will likely be held in check with mostly favorable US weather while farmers look to free up storage ahead of harvest.  Energy prices are mixed in 2-sided trade as markets monitor developments on Middle East peace negotiations and potential reopening of the Straits of Hormuz.  Spot WTI crude is up $.60 a barrel at $75.80.  Spot RBOB is up $.02 while HO is down $.03.  Heavy rains the past 24 hours in S. IA along with the northern half of MO.  Precipitation into early next week will favor E. IA into the Great Lakes region.  Rain will be much more scattered in the S. Midwest and WCB with temperatures holding at above to much above normal readings.  Week 2 of the outlook calls for normal to above normal rains across the nation’s midsection.  Cooler than normal temperatures across Argentina and S. Brazil with precipitation limited to S. Brazil.  Warm and dry across C. and Northern growing regions of Brazil.  Hot across all of Europe with only scattered rain in France and the S. Alps.  The US $$$ is slightly higher in quiet 2-sided trade.  US stock indices are mixed.

Corn: 

Sept-26 and Dec-26 are $.01 lower at $4.35 ¾ and $4.59 respectively with both holding within yesterday’s range.  Speculative selling has knocked the money manager long position back down to 118k contracts.  O.I. yesterday was up 2.6k contracts.  Export sales are expected to range from 35-70 mil. bu.  Argentine grain ports resumed normal operations yesterday following a work stoppage on Tues. as maritime pilot forced a 24 hour work stoppage.  Despite legal challenges, Brazil has moved ahead with their mandated higher ethanol blend in their nations fuel supply.  E32 took effect Aug. 1^st up from a 30% blend.  Expana lowered their EU production forecast another 4.6 mmt to 49.1 mmt, well below the USDA est. of 57.5 mmt.

Soybeans: 

Sept-26 and Nov-26 soybeans are both $.02 lower at $11.54 ½ and $11.73 respectively.  Both held within yesterday’s range.  Nov-26 appears to be building support near its 100-day MA at $11.70 ¼.  Sept-26 meal is up $.20 at $310.40 while Sept-26 oil is steady at 67.72.  Crush margins are little changed at $2.74½ bu.  Cash sources suggest China purchased another 800k mt of US soybeans yesterday as they continue to get a jump toward reaching the 25 mmt commitment.  Chinese leader Xi is expected to visit Washington DC in 7 weeks.  Export sales are expected to range from 36-70 mil. bu. of soybeans, 200-500k tons of meal and -10-10k tons of oil.  Speculative traders were modest sellers across the complex yesterday cutting their next long position across the complex down to 292k contracts vs. the all-time high in May-26 of 502k.  Soybean O.I. was down 14k contracts while production were little changed.

Wheat: 

Prices are mixed and within $.02 of unchanged.  CGO Sept-26 is $.01 lower at $6.41 ¼, KC Sept-26 is $.02 ½ lower at $7.11 while MIAX Sept-26 is up $.01 ½ at $6.85.  Algeria reportedly bought around 720k mt of wheat yesterday with prices near $289-$290/mt CF.  Logistical issues continue to create supply disruptions from the Black Sea region providing underlying support.  A Russian missile damaged a vessel in the Black Sea carrying Ukrainian wheat.  Ukraine is reportedly working with Romania to shift export shipments through their Constanta port.  Export sales are expected to range between 9-16 mil. bu.

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