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261983

3 Big Things Today, August 14

Crop Progress Report to be eyed Monday.

1. The USDA’s Weekly Crop Progress Report Monday will offer investors fresh trading news.

In the overnight markets, the December corn futures contract traded 4¢ lower at $3.70 per bushel. The November soybean futures are 8½¢ lower at $9.36. The September wheat futures 6¢ lower at $4.33.

Al Kluis, Kluis Commodities broker, says Monday’s grain markets could feel the hangover of the lower overnight markets, until new news is announced.

“Watch the crop conditions report today. If conditions move lower, then odds are good that the USDA will eventually take yields lower as well,” Kluis stated to customers in a daily note.

The USDA will release its Crop Progress Report at 3 p.m.

Last week, 60% of the U.S. corn crop had been rated good/excellent, below the 61% rating a week ago, and sharply below the 74% rating a year ago.

The U.S. soybean crop good/excellent rating is at 60%, slightly ahead of last week’s 59% rating.

The market is still trying to distance itself from last week’s August Supply/Demand Report. The government shocked the trade with a 2017 U.S. corn yield at 169.5 bushels per acre vs. the USDA’s July estimate of 170.7 and the average trade estimate of 166.2 bushels per acre.

For soybeans, the USDA’s U.S. yield is estimated at 49.4 bushels per acre vs. the trendline forecast of 48 and the average trade estimate of 47.5 bushels per acre.

 

2. Over the weekend, some much-needed rains fell in South Dakota, southwest Minnesota, and northwest Iowa.

From Friday’s forecast, little has changed. For the next five days, the Corn Belt states are expected to get normal to below-normal temperatures and to remain dry.

David Tolleris, WxRisk.com, says the six-to-10 day outlook is more promising for the Corn Belt crops.

“Today it looks like the forecast for widespread rain across the Corn Belt is right. Most of the Corn Belt – over 70% – should get 1 to 2 inches of rain that will start out August 18 or 19 and work west to east,” Tolleris stated in a daily note to Kluis Commodities customers.       

3. Investors switch to the ‘short’ side in the corn futures market.

On Friday, The Commodity Futures Trading Commission’s weekly Commitment of Traders Report showed that large speculator investors sold enough contracts to get net short in the CME Group’s corn market.

In the week of August 8, regulatory data released on Friday showed that noncommercial traders, including hedge funds, pushed up their net-short position in the CME Group’s wheat and increased their net-short position in soybeans.

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