3 Big Things Today, July 3, 2018
1. The grain farm markets close today at 12:05 p.m. CDT and the livestock markets close at 12:15 p.m. CDT.
In overnight trading, September corn futures are 3½¢ higher at $3.50; December futures are 3¾¢ higher at $3.62.
August soybean futures are 10¢ lower at $8.48; November soybean futures are unchanged at $8.69.
September wheat futures are 9¾¢ higher at $4.90.
In the outside markets, the NYMEX crude oil market is 94¢ higher, the U.S. dollar is lower, and the Dow Jones Industrials are 114 points higher.
The macro markets will be focused on the June report on auto sales, released today. The ‘street’ expects the report to show an annualized rate of 17 million vehicles. The May report on factory orders is also set for release Tuesday.
Also, Tuesday is a half day in the U.S. equity market, with the New York Stock Exchange closing trading for the day at 1 p.m. EDT. Bond markets will also be closing early, settling at 2 p.m. EDT.
2. This week’s grain market continues to watch crop-weather outlooks, USDA crop condition ratings, and trade action.
Investors will also be watching for any progress on the trade tariffs, with July 6 being the date that U.S. tariffs on Chinese goods go into effect.
Al Kluis, Kluis Commodities, says investors are counting down to the U.S. trade deadline of July 6, when tariffs are enacted on Chinese import products.
“The grain markets closed lower on Monday with no resolution of trade tension with China and favorable weather forecasts. This combination continues to pressure the grain market. There are now just three trading days until the possible tariffs take effect,” Kluis stated Tuesday in a daily note to customers.
3. Weaker crop ratings are expected to continue.
On Monday, the USDA rated the U.S. corn crop as 76% good/excellent, slightly below last week’s rating of 77%.
USDA pegged 17% of the corn crop as being in the silk stage vs. an 8% five-year average.
“The USDA Crop Conditions Report yesterday showed a 1% decline in corn and 2% in soybeans. I look for additional declines next week,” Kluis stated Tuesday.
In its report, USDA pegged the U.S. soybean crop condition for soybeans at 71% good/excellent, below a 73% rating a week ago.
USDA rated 27% of the soybean crop in the blooming stage vs. a 13% five-year average.
The 1- to 5-day forecast includes rain for the Dakotas, Minnesota, and northern Illinois, according to WxRisk.com.
The 11- to 15-day forecast keeps it hot for the eastern Corn Belt, but the central and northern Corn Belt should see seasonal or cooler temps.