8/10/18

Morning Bullet Points - 08/10/2018

GOOD MORNING—

MARKET HIGHLIGHTS

  • Markets trading mixed overnight as we head into the August USDA numbers at 11am CST this morning.

 

 

2018 Production

Actual

Average

Range

Last Month

Corn Yield

 

176.2

171-180.2

174

Corn Production

 

14.411

14.150-14.740

14.230

Bean Yield

 

49.6

48-51.5

48.5

Bean Production

 

4.407

4.280-4.576

4.310

 

 

2017/18 US Ending Stocks

Actual

Average

Range

Last Month

 

Corn Stocks

 

2.021

1.9-2.137

2.027

 

Soybean Stocks

 

460

437-480

465

 

 

 

 

 

 

 

2018/19 US Ending Stocks

Actual

Average

Range

Last Month

 

Corn Stocks

 

1.636

1.457-1.812

1.552

 

Soybean Stocks

 

638

565-726

580

 

Wheat Stocks

 

961

850-1.018

985

 

 

2017/18 World Stocks

Actual

Average

Range

Last Month

 

Corn Stocks

 

190.81

189-192.62

191.73

 

Soybean Stocks

 

95.53

92-97

96.02

 

Wheat Stocks

 

273.12

271-274

273.5

 

 

 

 

 

 

 

2018/19 World Stocks

 

 

 

 

 

Corn Stocks

 

152.59

148-158.23

191.96

 

Soybean Stocks

 

99.33

94-102.2

98.27

 

Wheat Stocks

 

256.42

250-259

260.88

 

 

 

 

US Wheat production

Actual

Average

Range

Last month

 

All Wheat

 

1.85

1.7-1.885

1.881

 

All Winter Wheat

 

1.180

1.05-1.201

1.193

 

HRW

 

656

635-665

657

 

SRW

 

302

290-313

303

 

White Winter

 

230

210-240

232

 

Other Spring

 

601

570-633

614

 

Durum

 

74

69-78

75

 

  • The CFTC will update managed fund positions this afternoon with no big changes expected in corn/soybeans as the market has traded mostly sideways during the data period.
  • SovEcon lowered the Russian wheat production forecast to 68.4 MMT (USDA 67).
  • Ukraine Ag ministry is estimating wheat production at 24 MMT (USDA 25.5) with exports limited to 16 MMT (USDA was 16.5 last report).
  • Corn technically continues to consolidate in this area with the trend higher.  Support for Dec. at 3.80 and resistance 3.93.
  • Soybeans technically also seeing consolidation near 9.00 with the trend higher.  Support at 8.80 and resistance at 9.30.
  • Wheat continues to correct from recent highs with the trend still higher.  Support at 5.55 and resistance at 5.90.
  • USDA reported 80,000 MT of soybeans to unknown for 2017/18.
  • USDA reported 130,000 MT of soybeans to unknown for 2018/19.

WEATHER

  • Heat remains over the northern Midwest for the next 10 days before cooling off in the 11-15.
  • Spotty rains over the next couple of weeks could lead to some stress in areas that have been short-changed on moisture.
  • Europe has caught rain in the last couple of days to help their corn.

OUTLOOK

  • With smaller crops expected around the world, corn should have a good outlook as long as the USDA does not put out a +178 bpa national yield today (average estimate is 176.2).  I think that is unlikely at this point but could be larger on further reports.  If it does come out larger than the average trade guess and the market pulls back, I look for buyers to step in.
  • Soybeans do not have the story that corn does with lower demand from China the biggest change.  Soybeans will have to rely on a higher corn market to trade up from here, but I do think that is likely.
  • It would not be a surprise for the wheat numbers to come out a little bearish today, as the USDA is often conservative when changing production numbers.  The world wheat supply situation is getting more supportive by the day, however with hot/dry conditions in Canada the latest growing area to join in on the crop problems.  Look for pullbacks to be supported.

Fun Fact of the Day:  Hair gets frizzy in humid weather because the chemical makeup of human hair is extremely sensitive to airborne hydrogen.

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