What Traders are Talking About:
* USDA August crop reports awaited. Traders are anxiously awaiting USDA's first survey-based estimates of the corn and soybean crops Friday morning. Pre-report guesses from a Dow Jones survey put the corn crop at 10.971 billion bu. (126.2 bu. yield) and the soybean crop at 2.786 billion bu. (37.2 bu. Yield). But the average guesses don't tell the whole story. The guess range for corn production is 9.86 billion bu. to 11.75 billion bu., with the corn yield guess range from 117.6 bu. To 134 bu. per acre. For soybeans, the guess ranges are 2.4 billion bu. To 2.925 billion bu. and 32 bu. To 39 bu. Per acre.
The long and short of it: Pre-report guess ranges are very wide, signaling just how much uncertainty there is concerning this year's crops.
* Rains falling on areas of western Belt. Scattered rains developed in the western Corn Belt overnight and are continuing this morning. Radar images indicate small clusters of rains, which appear to be decreasing as they move east. Additional scattered rains are forecast to develop behind the initial wave. But unless any additional rains are heavier and more organized, it appears areas getting beneficial precip will be limited.
The long and short of it: While the showers are scattered and light, it's hard to attract buying interest, especially in the bean market, when rains are falling.
* More calls for ethanol mandate waiver. A group of 25 senators sent a letter to EPA Administrator Lisa Jackson Tuesday urging her agency to lower the ethanol usage mandate because of soaring corn prices due to the drought. Last week, 156 House members sent a similar letter to Jackson. And a group of 19 livestock and poultry groups petitioned EPA last week to cut the ethanol mandate.
The long and short of it: While pressure on EPA to lower the corn-based ethanol mandate is building, we continue to hear a near-term decision is not likely. In fact, our sources signal EPA will wait on at least a couple of Crop Production Reports before making a decision.
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