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Good Morning farm country. Davis Michaelsen here with your morning update for Wednesday, August 12. From Pro Farmer’s First Thing Today, these are some of the stories we are watching this morning:
Corn and soybean futures faced light pressure as traders prepared for the release of USDA’s August reports, which are generally expected to favor market bears. Most contracts are steady to a penny lower as of 6:45 a.m. CT. Winter wheat futures are down 2 to 3 cents, while spring wheat futures are steady to fractionally lower. The U.S. dollar index is marginally lower; crude oil futures are posting modest gains.
Today’s focus is on USDA’s Crop Production and World Agricultural Supply and Demand Estimates that will be released at 11:00 a.m. CT. The report will include USDA’s first survey-based production estimates for corn, soybeans and cotton. But unlike previous years, the estimates will not include field-based assessments of yields. Analysts surveyed by Reuters expect USDA to raise its corn and soybean yield projections. New-crop carryover will likely climb from July for corn, soybeans, and wheat, according to those surveyed.
Iowa Ag Secretary Mike Naig said Monday’s Derecho storm with hurricane-force winds may have impacted roughly 10 million acres of Iowa farmland and wiped out millions of bushels worth of grain storage. Some say Naig is overstating the damage. The ag secretary said some of the damaged corn will “still make a crop.”
China continues its purchases of U.S. commodities under the Phase 1 agreement signed Jan. 15 between the U.S. and China to start the year, with White House economic adviser Larry Kudlow telling reporters the deal is “fine.” U.S. and Chinese negotiators are set to discuss implementation of the Phase 1 trade deal in the coming days, with Beijing pushing for the recent measures targeting businesses including TikTok and WeChat to be on the agenda.
Democratic Presidential candidate Joe Biden has selected Senator Kamala Harris as his running mate. Harris, a former attorney general for California, would be the first Black and Asian American vice president. She is only the fourth woman in history to be chosen for a presidential ticket.
Today the U.S. Trade Representative is expected to review the European products on which to impose tariffs, as part of a long-running dispute over aircraft subsidies. In late June the USTR proposed hitting imports including olives, vodka and chocolate and worth $3.1 billion in 2018.
Cattle futures got a boost yesterday from reports of higher cash cattle prices. Another week of higher trade signals the market may be working through backlogs faster than expected. Cash hog bids fell $1.01 on Tuesday, which contributed to heavy pressure on lean hog futures. The CME lean hog index has moved sidewise after climbing the second half of July. Near-term supplies of market-ready animals remain burdensome.
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