Joe Lardy

Jul 31, 2020

Highlights

  • The weather forecast for the next ten days has some rain but with below normal temps.
  • Amazon, Apple, Facebook, and Google all reported quarterly earnings that beat expectations.
  • China’s manufacturing index expanded for the 5th straight month and suggests that Chinese factories are returning to pre-covid levels.
  • The crude oil market is stronger with crude up 32 cents at 40.24/barrel.
  • US$ is down .036 at 92.985 and gold is up $24 at 1966.

Corn

  • The overnight trade has futures a few ticks on the plus side heading into the morning break.
  • The flash corn sales of 1.937 million tonnes to China reported yesterday was the biggest ever. It surpasses the old record set just 2 weeks ago.
  • The corn market will post a monthly loss for the first time in 3 months.
  • Spreads: U/Z 11 carry, Z/H 11.50 carry, Z/N 25.50 carry, Z/Z 36 carry.

 

Outlook:  The corn markets are hovering around unchanged again. Corn needs to see export activity to take the lead on its own or else it will just follow beans and wheat.

 

 

Oilseeds      

  • The bean market continues to good strength with futures up 4 cents this morning.
  • There were zero soybean deliveries but there were 24 contract of meal and 412 contracts of oil deliveries.
  • Yesterday’s Export sales for new crop beans were gigantic at 3,344,200 and that total was the highest in more than 8 years. The huge number has lifted the bean complex yesterday and today.
  • US crush is expected to drop for a third straight month according to analyst polled ahead of the USDA monthly crush report.
  • Spreads: X/F 5.75 carry, X/H 3.75 carry, X/N 13 carry, X/X 5.5 carry.

     

    Outlook:  Beans continue to rally on yesterday’s huge export sales total.       

     

     

    Wheat

  • The wheat market is higher with futures up 3 cents overnight.
  • Rains in the central plains is slowing the last of the winter wheat harvest.
  • Argentina’s wheat crop is 96% planted but they have had frost recently so that has added some worry about crop growth.
  • The French soft wheat crop is 90% harvested now, although conditions are way below last year.
  • Spreads: Mpls U/Z 13 carry and Kansas City U/Z 10.5 carry.

 

Outlook: The wheat markets are slightly high but December futures still remain rangebound between 530 and 540.