Crop Ratings Fall More Than Expected
Aug 07, 2018
Good Morning! From Allendale, Inc. with the early morning commentary for August 7, 2018.
Grain markets found support overnight as US crop ratings were a little lower than expected. Trade war concerns continue to circulate as neither the US nor China seem willing to make the first concession, leaving some to conclude that the spat will go on longer than first thought.
Crop conditions yesterday reported US corn at 71% Good to Excellent, in line with analyst expectations. Soybeans were rated 67% GTE a drop of 3% from last week, and lower than trader estimates of 69%. Spring wheat fell 4% to 74% GTE, also below the estimate of 77%. The crop was also reported 13% harvested. Winter wheat harvest is just about wrapped up, being reported 90% complete.
Bloomberg released their average trade estimates for Friday's USDA Supply and Demand report. Traders are estimating a corn yield of 176.3 bushels per acre, which would be an increase from July's 174.0. Soybean yield is seen at 49.8 bpa, last month's number was 48.5.
Corn production is estimated at 14,416 million bushels, an increase from July's 14,230 mb. Soybean production is estimated at 4,425 mb, again an increase from last month's 4,310 mb.
China is likely to cut imports of soybeans by more than 10 million tonnes this year, thanks to new soymeal technology and the use of supplements such as sunflower seeds and palm seeds, state media Economic Daily reported. (Reuters)
Export inspections for the week ending August 2nd showed wheat exports of 325,486 tonnes, corn 1,287,772, and soybeans of 893,109. The soybean number was a bit above expectations.
The worst drought in living memory is sweeping parts of eastern Australia, leaving farmers struggling to cope and asking questions about their future. Record-low rainfall in some regions and successive seasons of above-average temperatures have blighted vast tracts of Australia's grazing and crop land. (Reuters)
A judge in Brazil has banned the use of products containing glyphosate pending a review by the government of the chemical's toxicity. Producers in Brazil have previously been allowed to plant GMO corn and soybeans resistant to glyphosate.
Managed money funds were estimated buyers of 6,000 corn contracts and 11,500 wheat in yesterday's trade. They were sellers of 5,500 soybeans, 3,000 soymeal, and 2,000 soyoil.
June beef exports were reported by USDA at 272.606 billion pounds which is 14% over last year. Beef import data was neutral to slightly positive. At 291.206 billion, it was 1% under last year's June imports. Net imports ran 19 million lbs.
June pork exports came to 454.48 million lbs. That was 1% over last year - mixed for market impact. The previous two weeks ran 18% and 0% compared with last year. Pork imports are not a big deal due to the export/import disparity. For June, USDA's converted import data shows 82.725 million lbs. That was 13% under last year. The two previous months ran 3% and -1% year over year.
Dressed beef values were higher with choice up .93 and select up 1.24. The CME Feeder Index is 149.74. Pork cutout value is up 1.13.