Grains were mixed early on Thursday, with livestock mostly higher.
Corn Tries to Bounce on Short Covering, Exports and Report Positoning
Mark Knight with Farmer’s Keeper Financial says corn opened lower but was trying to recover early on short covering, but also following the strength in the wheat market.
The market is also preparing and seeing some evening of positions ahead of Friday’s WASDE Report, where Knight does not expect USDA to change yield, but they could increase demand and tighten ending stocks.
“I’d be surprised if they don’t raise export demand at least 50 million bu.,” he says.
Weekly export sales were also solid for corn on Thursday with 49.7 million bu. old crop and 35 million bu. new crop. Plus there was a flash sale of 4.3 million bu. of corn to unknown destinations for 2025-26.
He says, “USDA released great export numbers, much higher than expected for both old crop and new crop corn today. In fact, we need net cancellations to meet their number.”
However, rallies will be met with selling as funds are short the market and in control. Knight says they’re looking at favorable weather, improved crop ratings and higher yields.
Some models are showing 185 to 186 bu. corn, which Knight thinks is a stretch.
“I Just find with the added acres that we’ve got this year what close to five million more acres in last year, you’re penciling in a bunch of acres that are you know 141, 150 type yielding acres in fringe states,” he explains.
Wheat Sees Short Covering
Wheat was higher in all three classes early on Thursday which Knight attributes mostly to short covering.
However, weekly exports were also encouraging at nearly 21 million bu.
The market is also expecting a slightly smaller wheat crop in the WASDE on Friday due to lower harvested acres (down 600,000 acres), which could take the market by surprise and will somewhat offset the build in stocks versus a year ago.
Soybeans Fall on Tariff Concerns, Lack of Trade Deals
The soybean market has been under pressure since the start of the week on disappointment President Trump did not announce an agreement with China in Iowa last Thursday, but also the lack of movement on other trade deals.
Add to that tariff concerns are starting to arise as the July 9 deadline on the tariff delay was met with nearly 20 letters to countries increasing levies by Aug. 1 without some sort of movement on negotiations.
On Wednesday, President Donald Trump warned Brazil he will impose a 50% tariff on all Brazilian exports to the U.S. starting Aug. 1 unless President Lula da Silva halts what Trump called a “witch hunt” trial against former president Jair Bolsonaro. Lula said the new tariffs would be met with reciprocal measures.
Knight says that caused the Real to drop 2%, which makes U.S. exports of soybeans and corn less competitive.
Plus, the uncertainty of tariff increases of 25% on major trading partners like Japan and South Korea and even the Philippines has the market on edge.
November soybeans took out critical support at $10.15 on Wednesday and are seeing follow through selling on Thursday as funds liquidate some of the remaining slightly long position they have in soybeans.
Cattle Hit More Record Highs as Border Closes....Again
Both live and feeder cattle futures gapped higher into record highs again Thursday morning.
The market was already getting a push from steady to higher cash trade ideas but got an extra boost from two other factors.
First, USDA announced Wednesday night they were shutting the border once again to Mexican livestock imports as another New World Screwworm (NWS) was detected just 370 miles from the U.S. border.
Knight says, “I think they may close the border indefinitely with the pest getting this close and that will continue to mean tighter supplies of replacements.”
Possible 50% tariffs on Brazil will also slow imports of beef into the U.S.
“Brazil is our third largest importer of beef,” he says.
