CBOT corn rallied a quick 8-10 cents, as the US forecast is getting more threatening into the final week of July. The major forecasting models this evening are in general agreement that heat will expand into Western Corn Belt in the next 10 days, and virtually no rain is projected outside of modest totals across the Great Lakes in the next 72 hours.
Crop ratings fell as expected, and until a weather pattern shift occurs it’s difficult to say just how much US corn yield potential is being lost?
Corn’s US GD/EX fell to 65%, down 3% on the week and compared to in mid-July a year ago. GD/EX in the N Plains now exists at just 37-52%, and ARC expects a more noticeable drop in IA next Monday. Oat, barley & sorghum ratings are all below last year as well. Yield potential is being lost.
Cumulative US export commitments total near a record 88% of the USDA’s annual forecast, and despite record surpluses in S America, we look for 16/17 exports to be lifted 25 Mil Bu on Wednesday. There’s a price that allows S American exports into the US, and encourages even more expansion in Argentina next year. However, this is closer to $4.30-4.40 basis December ’17. Longer term, sales at $4.29 or above December ’18 are advised for farmers.
