DeLong Commentary

CBOT Prices:

Corn traded steadily lower throughout the day session, posting losses of 3-4 cents. The Dec25 futures contract closed the day 4.25 cents lower at 4.215, with the Mar26 finishing 4.0 cents lower at 4.3825. CZ/CH last traded 16.5 cents carry, up 1.25 cents on the week.

Soybeans finished the day 1-2 cents higher. The Nov25 and Jan26 ended the day up 1.75 cents at 10.14 and 10.33, respectively.

Argentina’s tax suspension put pressure on all of the grain and oilseed markets this week. However, Water levels improved, reducing barge freight and pushing upriver basis values higher.

Market Headlines:

Agriculture Secretary rules out payment program for building cattle herds: Brooke Rollins said on Thursday that the Trump administration will announce a plan to expand U.S. beef production next month. However, she stated that the USDA has no plans to include a finical incentive for farmers.

The DOJ will investigate rising production costs for US farmers: The DOJ will coordinate with the USDA to assess input costs, like equipment and fertilizer. The DOJ will review competition in the agricultural marketplace and will enforce antitrust laws to encourage fair markets. In addition, the USDA will continue to study fertilizer costs and explore potential relief options. These efforts aim to protect farmers and ranchers from rising and volatile production costs.

China bought around 40 cargoes of soybeans from Argentina this week: Argentina suspended their export taxes on products including corn, soybeans, and wheat to try to boost export sales as well as uplift the peso. This tax suspension hit the $7 billion sales cap in just 2 days. During that window China purchase roughly 96 million bushels of soybeans for November/December delivery, which is typically the timeframe that the US would ship soybeans to China.

USDA weekly drought monitor data: Drought conditions were mostly unchanged last week across the Corn Belt. 38% of the region is experiencing some kind of drought with parts of Missouri, Ohio, and Kentucky facing extreme drought. Improvements in drought conditions have been seen by Nebraska, South Dakota, and Kansas in the past week.

US Areas Experiencing Drought:

• Corn: 26%
• Soybeans: 37%
• Winter Wheat: 45%
• Spring Wheat: 13%
• Cattle: 24%

USDA will release its quarterly Grain Stocks report next week: September 1st stocks of corn are expected to be lower compared to the same period last year – traders estimate US corn stocks on September 1st were 24% lower than a year ago. Soybean stocks are estimated to have declined 5.6%.

 Let’s Talk!

Yield365 – Grain Marketing Simplified

call: 815.823.2522

Click HERE to learn more

Click HERE to view previous market commentary