Morning Highlights


Highlights

  • The August WASDE is out today at 11:00 AM Central along with the FSA crop acreage estimates.
  • Equity markets are weaker as global economic worries weigh on the market. There are concerns for the US/China trade war global impacts and for the protests in Hong Kong causing all flights out of the Hong Kong airport to be cancelled.
  • EPA has granted 31 more small refineries to the small refiner exemption list for blending of ethanol, reducing the demand and margins for ethanol.
  • As of 7:05 AM CT, September crude oil was down 33 cents at $54.17, the dollar index was up .023 at 97.345, and Dow futures were down 155 points.
  • Fire at a Tyson cattle packing plant in Holcomb, Kansas has closed the plant indefinitely.
  • China has lowered its forecast of feed grain and soybean consumption as the African Swine Fever continues to spread.
  • Forecast calls for beneficial rains for much of the Corn Belt for this week.

 Corn

  • Corn was weaker overnight as the market eagerly waits for the USDA estimates to come out at 11:00 AM CT.
  • Planted acre estimates have a significant range with the average guess at 87.998 million acres and harvested acres expected to be at 80.050 million. Yield is expected to decrease from 166 bushels/acre in July to 164.9 bushels/acre. 2019/20 ending stocks are expected at 1.620 billion bushels but the range on guesses was 1.281 billion on the low end to 1.900 billion bushels on the high end.
  • With the amount of information the market is going to receive today from the WASDE report and the FSA acreage numbers, there could be some significant volatility as the market digests what it all means.
  • Farmer selling has been very slow as many are waiting for the August report numbers to provide more clarity to the market.
  • Spreads: U/Z 7 ¾ cent carry; Z/H 10 ¼ cent carry; Z/N 19 ¾ cent carry.

Outlook:  Lower up to the report, then will get direction from the USDA reports.

 Oilseeds

  • Soybeans were lower as well waiting for the USDA estimates to provide more clarity.
  • Soybean planted acres are estimated to be at 81.006 million acres and harvested acres are expected to be 79.890 million acres. The yield is expected to come in at 47.6 bushels/acre. 2019/20 ending stocks are estimated to be at 821 million bushels with the range of guesses from 607 million bushels to 950 million bushels.
  • The market is expected a drop for crop conditions tonight with the dry areas of Illinois, Indiana, and Ohio.
  • Chinese soybeans were unchanged at 3,465 yuan per tonne. Soymeal was up $1.40 per ton settling at 2,886 and soyoil was up 66 and settled at 6,170.
  • There were 966 deliveries of August beans, 185 deliveries of August meal and 99 of soybean oil.
  • Spreads: U/X 12 ¾ cent carry; X/F 13 cent carry;

 Outlook: Lower up to the report, then will get direction from the USDA reports.

 Wheat

  • The wheat markets were weaker overnight with winter wheat markets down a couple and Minneapolis wheat unchanged.
  • Winter wheat production is expected to stay flat at 1,294.6 billion bushels vs. 1,290.6 in the July report. Spring wheat production is expected to be lower at 572.6 million bushels.
  • World ending stocks are expected to be lower with reductions out of the FSU, Australia and possibly the EU. 
  • Russia has been granted permission to export wheat to Saudi Arabia as they relax their bug-damage specifications for wheat imports.
  • IKAR has lowered their Russian wheat production forecast to 75 MMT, down from 75.5 MMT.
  • Spreads: Chicago U/Z 2 ¼ cent carry; Kansas City U/Z 16 cent carry; Minneapolis U/Z 11 cent carry.

 Outlook: Lower up to the report, then will get direction from the USDA reports.