Afternoon Market Highlights
7/1/2019 2:44:13 PM
US/Chinese trade talks are expected to resume, although it seemed to have little influence on the market. This week is a shortened trade week as the trade observes of the 4th of July Holiday. The focus will be on the USDA’s decision to re-survey corn acres and their findings. This may take until the August or October crop production report before it gets ironed out (it could very well take until the end of the year to get a good feel for acres planted and acres slated for prevent plant).
- Weekly crop progress/conditions report is scheduled for 3 pm today.
- The Ag markets will be closed Wednesday evening, Thursday and Thursday evening. Trade will resume Friday morning.
- Egypt’s GASC tenders for optional origin wheat for FH August shipment.
- The energy markets are mostly higher with crude oil trading above $59/barrel.
- The US$ is up 691 at 96.82 and the gold market is down 25-26 bucks at $1,378/ounce on another truce between the US and China.
- The DJIA is up 50 at 26650, the S&P is up 18 at 2962 and the NASDAQ is up 61 at 8067.
Corn prices fell lower on followthrough from last week’s USDA’s acreage data, improving weather conditions and expectations for increased crop conditions after last week’s heat that moved through the Upper Midwest. The December contract dipped down to $4.20 ¾, within striking distance of filling the gap at $4.20 back on May 24th. Once the gap is filled, the next line of support is at $4.
- Closes: September at $4.15 ½, down 9 ¼ cents, December at $4.22 ½, down 9 cents and July 20 at $4.40, down 6 cents.
- Crop conditions are estimated at 57% G/E compared to 56% G/E last week.
- Weekly export inspections were disappointing at 273 tmt, below trade estimates of 500-800 tmt.
- Spreads: U/Z 7 carry, Z/H 9 ½ carry, H/K 4 ½ carry, N0/Z0 27 ½ inverse.
Soybean prices traded lower on favorable weather conditions and thoughts of improving crop conditions. Trade talks between the US and China are said to begin again but did not encourage higher prices. The market feels like it is looking for something more substantial than this before prices can turn higher. The November closed near the day’s low of $9.07 with support at $9.00 and again at $8.50. There is an unfilled gap at $8.64 ½-$8.58 from back on May 28th.
- Closes: August at $8.89 ¾, down 14 ¼ cents, November at $9.08 ½, down 14 ½ cents and July 20 at $9.44 ½, down 10 ½ cents. The products were lower with meal down 8-9 bucks and oil down 26 points.
- Crop conditions are estimated at 56% G/E compared to 54% G/E last week.
- Weekly export inspections were pretty decent at 719 tmt, near the high end of trade estimates (450-750 tmt).
- Brazil was said to have exported 9.07 mmt of soybeans in the month of June. This compares to 10.84 mmt in May and 10.42 mmt a year ago.
- Hearing that soybeans are still getting planted this week, despite being past prevent plant dates.
- Spreads: Q/X 18 ¾ carry, X/F 12 carry, X/N 35 ¾ carry.
The wheat market traded lower on winter wheat harvest activity and spillover weakness form the row crops. Favorable weather conditions should allow for rapid harvest activity in the winter wheat. Russia’s wheat crop may mot match their production a couple of years ago, but it seems to be ample enough for them to keep a significant presence in the world export arena.
- September closes: Mpls at $5.44 ½, down 9 ¾ cents, KC at $4.43, down 18 ½ cents and Chicago at $5.11 ¾ down 15 ½ cents.
- Spring wheat conditions are thought to be unchanged at 75% G/E.
- Winter wheat harvest is expected to be near 30% complete after the active harvest weekend. Conditions are expected to be unchanged at 61% G/E and should begin to decline as more of the crop dries down and reaches maturity.
- Weekly export inspections were reported at 609 tmt, above trade estimates of 300-500 tmt.
- Russia’s wheat crop is estimated between 79.3-82.2 mmt, despite hot/dry weather during May and June.Their exports are estimated between 36.2-37.6 mmt.
- Spreads: Mpls U/Z 13 ½ carry, Kansas City U/Z 22 ¾ carry and the U9/U0 at 75 carry.