Morning Highlights


 

Highlights

  • USDA’s July WASDE will be released today at 11 am CDT. There is a lot of uncertainty around what the USDA will report so it could be a volatile day.

  • The US and China have continued negotiations by phone this week as China has introduced some new people to lead the negotiations.

  • The USMCA is expected to be sent to Congress after September 1st to allow the time to gather support for the agreement.

  • Major oil producers are pulling stuff and shutting production at many deep water gulf platforms in advance of tropical storm Barry in the Gulf of Mexico. Because the lower Mississippi is already near major flood levels, any significant rains puts New Orleans at great risk.  The storm is also being watched to see if it will bring rain up to the Midwest.

  • Nymex crude oil is higher, the US$ index is 301 ticks lower, and Dow futures are higher.   

     

Corn

  • Analyst’s estimates for today’s WASDE report show that corn harvested acres have a huge range between 76.2 and 84.3 million acres. Corn yields range between 162 and 167 bpa.    

  • China is reporting that the army worm problem is still spreading. China said that the pests have been found in 21 provinces now.   

  • Ethanol production dropped sharply yesterday.  The margin environment is still eroding as margins are now 9 cents negative.  

  • Export sales estimates for old crop is 150,000-400,000 tons and for new crop of 100,000-300,000 tons.

  • Spreads: N/U 1 carry, U/Z 3 ½ carry, Z/H 6 ¼ carry, Z/N 12 ¼ carry.

     

Outlook:  2 lower as the market waits for the WASDE report.

 

Oilseeds

  • Estimates for soybean harvested acres for the WASDE report range from 78.1 to 83.2 million. Soybean yields range from 47 to 51 bpa.     

  • Palm oil turned slightly higher after falling for three days in a row.

  • There are rumors that China stepped in for another round of soybean purchases from the United States as trade talks resumed.

  • Export sales estimates are 200,000-400,000 tons for old crop and 50,000-350,000 tons for new crop.

  • Spreads: N/Q flat, N/X 18 ½ carry, X/F 11 ½ carry, X/N 39 carry.

 

Outlook: unchanged as we wait for direction from the WASDE report.

 

Wheat   

  • The US wheat harvest marches on and most are reporting good yields.  Vomitoxin has not been an issue but protein levels are about ordinary.

  • Strategie Grains has cut its soft wheat production estimate for 2.2 million tons to 140.6 million tons.

  • Russia’s ag ministry confirmed that wheat exports will stand at 36 million tons. The USDA is using a 37 million ton export figure.  

  • Export sales estimates are 250,000-550,000 tons.

  • Spreads: Mpls U/Z 13 ½ carry, Kansas City U/Z 21 carry, Chicago U/Z 12 carry.  

     

Outlook: 1-2 lower. Nothing to report until we get to the report release at 11:00 cst.