** “Down and Dirty” has been the AM trading session with CBOT corn, soy and wheat futures sharply lower at midday. The market always “shoots first and ask questions later”, and that surely applies to summer row crop markets that have rallied sharply since the June 30th Stocks/Seeding report. A lower close is expected, but we expect it to be well off the morning’s low. ** The bearish overhang of the USDA July Crop report and tweaking by the EU weather model to cooler/wetter across the E Midwest during July 22/23 was enough to spark some considerable fund selling this AM. The fund selling has pushed corn, soybean and wheat futures back into consumptive buyer. ** US exporters tell ARC…
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All Members: Mid-day
Markets Higher; Models Still Dry in Western IA
The market remains uncomfortable with a lack of rain projected across the Plains and W Midwest.
New Upgrade of GFS Model Active at Midday; CBOT Adds Weather Premium on Continued Heat
** The CBOT is back to price levels at midday Tuesday – before the errant GFS weather model added a considerable amount of rain to the Central US weather forecast for next week. The primary function of CBOT prices is to add or subtract weather premium (in price) to account for yield considerations in mid July. Corn is the crop made or lost during July and that is where traders have been focusing much of their trading effort. By late July, traders will focus more on soybeans. For now, it’s all about US weather and yield considerations. ** ARC yesterday in our PM wire outlined the crop woes across the N and C Plains due to ongoing drought and its…
Markets Off Highs on Midday GFS Forecast
The midday run of the GFS model is much, much wetter than previously.
GFS Wetter at Midday for S MN/ N IA and WI; NOPA Crush Disappoints at 138 Mil Bu.
** As expected, the CBOT is trading both sides of unchanged this AM with a positive bias as the extended US weather forecast maintains the same kind of Ridge Central and Trough NE Canada that has prevailed for the past 6 weeks. The market senses that this R/T weather pattern will keep US corn, soybean and spring wheat crop condition and yield potential heading lower. And although seasonal price trends are bearish in the last half of July, caution is advised with US production potential in retreat. ARC looks for a mixed higher close today with traders anxious to gauge crop condition ratings this afternoon. ** The N Plains drought is become extreme! Unfortunately, the rains keep falling east of…
GFS Model at Midday Offers Heat/Dryness for South Central US and Plains
** The morning has been much slower in Chicago with corn, soybeans and wheat adding back weather premium as the forecast models flipped to warmer/drier over the next 10-14 days. Shorts remembering the last few Sunday evening’s (sharply higher) are covering with only modest fund demand noted. The charts turned down in Thursday’s collapse and fund managers are loath to return to the “buy side” until there is some healing of the technical considerations. AgResource looks for a stronger close and for traders to pay keen attention to the EU model that will be just starting before the 1:15 PM CDT close. ** Canadian ‘17 crop estimates are in decline based on 3-5 weeks of warm/dry weather. For crop areas…
CBOT Takes a Beating as Funds Sell On the Hope for Improved US Weather
** “Down and Dirty” has been the AM trading session with CBOT corn, soy and wheat futures sharply lower at midday. The market always “shoots first and ask questions later”, and that surely applies to summer row crop markets that have rallied sharply since the June 30th Stocks/Seeding report. A lower close is expected, but we expect it to be well off the morning’s low. ** The bearish overhang of the USDA July Crop report and tweaking by the EU weather model to cooler/wetter across the E Midwest during July 22/23 was enough to spark some considerable fund selling this AM. The fund selling has pushed corn, soybean and wheat futures back into consumptive buyer. ** US exporters tell ARC…
USDA Report Bearish; Central US Weather Hot/Dry into Late July
** USDA July WASDE Report Analysis: The July WASDE report was expectedly bearish on the grains and supportive to soybeans. Soybeans should gain on the grains on the weeks ahead as the market adds additional weather premium into soy complex prices as end stock forecasts decline. And US spring wheat production will continue to decline with abandonment rates to soar by the August and final Sept report. Today’s US HRS and durum crop estimates are only the starting point of the production decline process. ARC research forecasts another 65-85 Mil Bu drop in US spring wheat production by the final count. The July Crop report data has already been digested. The focus of the market going forward will shift back to…
Ridge Shifts to the Midwest Next Week; Hot/Dry Following USDA Report
** CBOT Trade volume has slowed from robust overnight levels as fund managers adjust their positions ahead of the USDA July Crop report on Wednesday AM. The market has a sideways feel at noon with either the bulls or the bears pressing their case too aggressively. Our bet is for a mixed close going home with corn losing on wheat and corn losing on soybeans. The unexpected rains this AM across C IL is producing some bearishness in corn. ** The big vocal point of the Wednesday’s USDA report will be on wheat and how small US HRS production will be? And WASDE will come out with their 1st by class S&D estimates for 2017/18 US stocks. WASDE is…
Midday GFS Forecast Warmer/Drier; CBOT Futures Surge
** The morning CBOT session has been a clone of the overnight trade in that corn, soybeans and wheat remain sharply higher, and at new summer rally highs in the row crops. Wheat futures have followed, but traders are increasingly interested in the heat/dryness harming crop potential in Canada and portions of Europe. The world cannot afford to lose any more spring or durum wheat without stimulating the need for acute demand rationing. NASS on Wednesday is expected to sharply cut spring and durum wheat yields in the 1st survey estimate of the crop year. Wheat traders do not want to be overly bearish with ARC estimating that the 2017/18 world wheat crop could fall a sizeable 40 MMTs. ARC…
Midday GFS Cooler/Wetter for N and E Midwest; Will the EU Model Confirm?
** Reduced cash connected selling from South America and the US farmer has allowed CBOT grain/oy prices to rise as funds remain on the buy side of the marketplace. CBOT values are adding weather premium to price due the persistent trend of below normal rainfall and above normal temperatures across much of the Plains and the W Midwest. ARC would note that the US model remains erratic beyond the next 5-6 days. And the more correct EU model results are not expected to be out until after the 1:15 CBOT close. ARC looks for a stronger CBOT settlement, but the real “fireworks” will not be offered early next week if the major weather models don’t offer a pattern change. US…