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3 Big Things Today, June 29

USDA reports take center stage Friday.

1. The grain markets keep searching for a silver bullet to turn the weaker trading trend.

In overnight trading, the July corn futures are 2 1/2¢ higher at $3.47. Dec. futures are 2 1/2¢ higher at $3.68.

Aug. soybean futures are 2¢ higher at $8.68.  Nov. soybean futures are 2¢ higher at $8.85.

Sep. wheat futures are 3 3/4¢ higher at $5.03. 

In the outside markets, the NYMEX crude oil market is $0.14 lower, the U.S. dollar is lower, and the Dow Jones Industrials are 93 points higher.

Al Kluis, Kluis Advisors says that the markets are having a hard time finding any favor.

“The saga continues for US grain prices. We simply cannot find much of any support,” Kluis stated in daily note to customers Friday. The trend lately is to sell any and all support and don’t look back. The markets will be choppy ahead of the release of the USDA report at 11:00 am this morning.”

He adds, “In the big picture, the price of commodities is favorable. World demand is still very strong. Sooner rather than later, the US vs China trade war will get resolved.”
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2. Today's the day for all investors to get what they have been waiting for; fresh USDA data to trade.

The USDA June Acreage Report and the Quarterly Grain Stocks Report will be released today at 11:00 CT.

For 2018 corn acreage, the trade sees the USDA printing an estimate of 88.52 million and soybean plantings at 89.69 million.  

The total use estimate for the third quarter places June 1 corn stocks at 5.168 billion bushels, according to University of Illinois economists.

“At this level, June 1 stocks come in 61 million bushels smaller than 2017 June 1 corn stocks. A June 1 corn stocks estimate that supports the USDA projection of 5.500 billion bushels of feed and residual use during the marketing year is considered neutral for corn prices,” the University of Illinois economists stated in a weekly analysis.


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3. Can Congress get a Farm Bill passed on time for the first time in years?

The U.S. Senate passed its version of the new Farm Bill Thursday. The U.S. House has already passed its Farm Bill.

Now that the two chambers have passed Farm Bills, it will go to a conference committee, made up of members from both sides and the bill will also face scrutiny from any other Congressional committee’s that the bill’s funding may intrude upon. Above all of these steps is the factor of time. Amongst upcoming holiday breaks, upcoming elections, and rumors of a powerful Democrat that thinks a better Farm Bill could be approved in November, the President may not see a Farm Bill on his desk to sign into law for months.

The lightning rod issue for the farm bill is expected to be the House-backed measure that involves welfare reform, to require 7 million or more “work capable” adults ages 18 to 59 to work at least 20 hours a week or spend equal time in job training or workfare to qualify for food stamps. The bill also makes cousins, nieces, and nephews eligible for farm subsidies and removes payment limits on some types of corporate farms.

Next up is work on the final, compromise version of the farm bill. It’s unknown if Congress will get to this step before the Fourth of July, three months before the 2014 farm law expires.

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