August 3, 2016
Grain Marketing Specialist
Ethanol numbers out this morning
CORN (Up 1)
The crop size seems to be getting bigger through a critical period as condition ratings remained neutral this week. The weather forecast looks benign as warm and wet weather looks prominent in the 10-14 day outlook. FC Stone came out with an updated yield estimate of 175 bpa, which puts us back above a 15 bln bushel crop. These kind of numbers have us pushing closer to the 2014 October low of $3.18, which we are now a mere 17 cents away on the December contract. Informa is expected to release their updated yield numbers on Friday as the next USDA WASDE report isn’t until next Friday. Nearby support for September futures is found at $3.19 with resistance at $3.32.
SOYBEANS (Up 10)
The bean market can’t seem to find its footing as condition ratings improve 1% this week and analysts increase their yield forecast. FC stone is currently estimating a 48.8 bpa yield, which is about 2 bushels higher than the USDA forecast. China continues to step into this market buying an additional 252k MT for 2016-17 delivery on Tuesday. China, reportedly is also going to be offering 600k MT of beans out of reserves on August 5th. The Brazilian soybean export line is down nearly 1/3rd year on year at 5.79MMT. Below is a look at the precipitation outlook for the next week.
WHEAT (Minneapolis Up 2, Kansas City Up 2)
Row crop prices keep dragging on wheat as domestic and world supplies remain ample. Spring wheat condition ratings were reported at 68% G/E, which is 2 points below last year but still ahead of the 5-year average. Spring wheat is now 10% harvested, which is in line with the 5-year average and 4 points ahead of last year. Winter wheat was reported at 89% harvested, up 6% on the week. Spring wheat harvest in South Dakota feels just over half way done with protein levels showing a pretty good range depending on where you’re cutting. North Dakota crop seems to have some variability with decent yields and a little lower protein levels seem to be the norm.