3 Big Things Today, August 2
1. Crop Futures Higher Overnight as Investors Focus on Weather
Crop futures were all higher overnight, as trader focus on ongoing dry weather in much of the Corn Belt instead of the amped-up trade war between the U.S. and China.
As little as 5% of normal amounts of rain has fallen in much of Iowa and Illinois in the past 30 days, putting crops with a shallow root system at risk.
Little rain is expected in the area in the next seven to 10 days, according to Commodity Weather Group Meteorologist David Streit.
The rain that will fall is in areas that don’t need it as much. Overnight, another round of storms rolled through eastern Kansas and western Missouri causing flash flooding. That area likely will continue to get rain for the next few days, but little precipitation is expected elsewhere.
Crop conditions, at least for now, remain fairly elevated with corn rated 58% good or excellent and 54% of soybeans earning top ratings, but that could change if rain doesn’t fall in the Midwest. The good news, Streit said, is that the weather is expected to be cool, which could prevent damage.
Still, with crops being planted so late, the lack of growing degree days could impact crops.
On the trade front, President Donald Trump imposed 10% tariffs on $300 billion worth of goods that weren’t previously subject to levies. China said it would have to take more countermeasures as the U.S. commits to increased tariffs on its goods, according to Reuters.
Soybean futures for November delivery gained 5¾¢ to $8.71 a bushel overnight on the Chicago Board of Trade. Soy meal added $2.30¢ to $302 a short ton, while soybean oil rose 0.09¢ to 28.25¢ a pound.
Corn futures for December delivery gained 2½¢ to $4.05 a bushel overnight.
Wheat for September delivery rose 3¼¢ to $4.79 a bushel, while Kansas City futures added 3¾¢ to $4.19½ a bushel.
2. Corn, Bean Export Sales Higher Week to Week, While Wheat Sales Drop
Export sales of corn and soybeans were higher week to week but still weren’t stellar, while wheat sales plunged.
Corn sales to overseas buyers rose 18% in the seven days that ended on July 25 to 143,100 metric tons, according to the USDA. Still, that’s down 43% from the prior four-week average.
Mexico was the biggest buyer at 145,000 metric tons, followed by Japan at 74,800 tons, and Taiwan at 15,900 tons. Canada bought 7,300 tons and El Salvador took 3,900 tons. An unknown buyer canceled a shipment for 79,500 tons and Colombia nixed a cargo of 16,400 tons, the agency said.
Sales for delivery in the 2019-2020 marketing year that starts on September 1 totaled 129,600 tons.
Soybean sales that were a net negative last week rose to 143,100 metric tons this week, the USDA said in a report.
Japan bought 67,800 metric tons, China was in for 66,800 tons, Mexico purchased 61,800 tons, Egypt was in for 58,800 tons, and Saudi Arabia took 55,000 tons.
The total would’ve been higher but an unknown customer canceled a shipment of 195,500 metric tons, and Pakistan nixed a cargo of 60,000 tons, according to the report.
For the 2019-2020 year, sales came in at 305,500 metric tons. China accounted for 68,000 tons of those sales, the government said.
Wheat sales plunged 42% week to week to 383,100 metric tons, which is also down 2% from the prior four-week average.
Brazil was the big buyer at 85,000 metric tons, followed by the Philippines at 71,900 tons, Japan at 51,300 tons, Mexico at 35,500 tons and Taiwan at 30,900 tons. An unknown buyer canceled a shipment for 50,100 metric tons, the USDA said.
3. Parts of Eastern Kansas Under Water as Excessive Rain Continues
Several roads in and around Abilene, Kansas, are impassable this morning due to flash flooding in the area, according to the National Weather Service.
Flood warnings and watches have been issued in parts of southeastern Nebraska, eastern Kansas, and much of western Missouri. Almost a foot of rain fell Wednesday night into Thursday, which kicked off the flooding, and another round of precipitation hit the area overnight.
Thunderstorms dropped another 2 inches of rain in the region, and an additional 2 inches was expected through early this morning, the NWS said in a report early this morning.
“Several rounds of moderate to heavy rainfall are expected (through Saturday morning),” the agency said in its report. “The best chances for this rainfall will be during the morning hours and again tonight.”
Up to an additional 5 inches of rain, possibly 6 or 7 inches locally, are possible in some eastern Kansas counties. The heavy rain may lead to a “rapid” increase in creek and stream levels.