Earlier in the week, grain markets started out with concerns of continued hot and dry weather. The concern pushed soybean futures toward 4-month highs. The weekly USDA Crop Progress Report showed U.S. soybeans rated “good to excellent” condition held unchanged at 71% with 10 states improving and seven states declining.
“[The] northern tier of the states over the next week will have at least one trough there, digging through the Canadian border, then down into the Great Lakes and Northeast as we head through the weekend and into early next week,” says AgDay meteorologist Mike Hoffman. “[With this] overall pattern, you obviously get a lot of heat.”
USDA has another slew of reports which will be released on Friday. Analysts believe the dry weather in the nation’s midsection won’t have a factor in the reports.
John Payne, author of “This Week in Grains and Oilseeds” says it will be a first snapshot of next year’s crop.
“It will be a nice look at what the initial carryout will look like on a tread line yield with the new acreage numbers we got,” says Payne.
Usually, this is not a report where USDA makes yield changes.
“For corn yields, they’ve only been changed four times in the past 20 years,” says Rich Nelson, chief strategist with Allendale. “Last time being was the 2012 drought. As for soybean yields, those were changed three times out of the past 20 years. The last time being last year, for instance.”
Payne believes these won’t be big reports when it comes to corn or soybeans. He thinks it could be a bigger report with wheat.
“[It’s] how [USDA touches] on the foreign markets like the European crop," says Payne. "They’ll update the Russian crops. Those are I think more of a factor here, more than probably what’s being discussed as far as limiting the upside in corn."
Listen to his analysis here.