Morning Highlights


  • The 10-year Treasury note dropped below the 2-year rate, signaling a recession is possible. In 7 out of 9 years, a recession followed this inversion. On average, it takes about 22 months for a recession to occur following this signal.
  • Germany’s export reliant economy performed poorly in the second quarter, down 0.1% from a year ago, as global economic woes hinder their exports.
  • Equity markets are expected to open weaker after the 2-year and 10-year yield curves invert. Yesterday’s stronger performance was due to additional tariffs being postponed until December for consumer goods including clothing, laptops and cellphones.
  • As of 7:00 AM CT, September crude oil was down $1.61 at $55.50, the dollar index was down 0.101 at 97.530, and Dow futures were down 370 points.


  • Corn recovered overnight after dropping 41 ¼ cents in the two days prior for the December contract.
  • Farmer selling prior to the report was light and has stayed quiet since with basis levels remaining steady.
  • The central Corn Belt didn’t get as much rain as hoped but another chance of rain is expected for the end of the week.
  • The drop in futures makes the US more competitive on exports but it’s not quite cheap enough to beat out South American sourced corn.
  • Spreads: U/Z 10 ¾ cent carry; Z/H 13 ½ cent carry; Z/N 27 ½ cent carry.

 Outlook:  Higher, recovering from two days of sharp losses.


  • Soybeans were slightly weaker overnight, giving back some gains following yesterday’s 10 cent jump higher. A sharp reduction in planted acres from USDA on Monday and an announcement from the Trump administration saying additional tariffs would be delayed until December on certain goods provided support.
  • The focus will now turn to the Pro Farmer Midwest Crop Tour next week. They are expected to run into immature soybeans due to the delayed in planting this year.
  • Argentine peso continued to weaken yesterday providing support to soymeal with expectations US soymeal will have more demand as Argentine farmers hold on to their soybeans.
  • There were 145 deliveries of August beans, 63 deliveries of August meal and 50 of soybean oil.
  • Spreads: U/X 12 ½ cent carry; X/F 13 ¼ cent carry;

 Outlook: Lower on selling pressure.


  • Wheat markets are higher across the board this morning, recovering from life of contract lows in the Minneapolis and Kansas City markets.
  • US wheat markets have become more competitive on the export market, but EU and Black Sea futures were both weaker yesterday as well.
  • The German wheat crop is expected to be at 23.81 MMT according their association of farm cooperatives. It is a sharp gain from last years crop, but a 40,000 MT drop from last month’s estimate as late heat and dryness made an impact.
  • Chicago wheat continues to hold a huge premium to Kansas City with the increase in hard red winter wheat production on the WASDE report while stocks are tight for soft red winter wheat.
  • Taiwan purchased 94,950 MT of milling wheat from the US.
  • Spreads: Chicago U/Z 3 ½ cent carry; Kansas City U/Z 16 ¾ cent carry; Minneapolis U/Z 13 cent carry.

 Outlook: Higher, recovering from contract lows and finding support from corn.