Good morning!
Grains weaker to open the week... Corn, soybeans and wheat faced price pressure during most of the overnight session and are near their lows this morning. As of 6:30 a.m. CT, corn futures are trading mostly a penny lower, soybeans are 3 to 4 cents lower and wheat is 6 to 9 cents lower. The U.S. dollar index is around 100 points higher and front-month crude oil futures are about 90 cents higher.
Rains return to western Corn Belt this week... Most of the western Corn Belt is forecast to receive some rainfall this week, while eastern areas of the region as well as portions of Kentucky, the lower Delta and interior southeastern states should be mostly dry through Friday. Rains are expected across the eastern Corn Belt during the upcoming weekend and early next week. Temperatures are expected to remain cooler than normal across the Corn Belt this week, while the Delta and Tennessee River Basin are likely to see seasonal temps.
August crop reports out later this morning... USDA’s Crop Production Report at 11:00 a.m. CT will feature the first survey-based corn and soybean crop estimates, based primarily off farmer responses and satellite imagery, along with the initial cotton crop estimate and updated wheat production. NASS will also incorporate FSA certified acreage data into its crop estimates. While USDA will also update old- and new-crop usage forecasts, the production estimates will be the focal point. Click here to view analysts’ pre-report expectations.
China raises 2023-24 soybean import forecast... China’s ag ministry raised its 2023-24 soybean import forecast by 2.27 MMT to 98.37 MMT, as falling global soybean prices spurred importers to book more arrivals for the final months of the marketing year. The ministry left its 2024-25 import forecasts for corn and soybeans unchanged this month. Corn imports are expected to plunge 10 MMT (43.5%) to 13 MMT, while soybean imports are forecast to decline 3.77 MMT (3.8%) in 2024-25.
Argentine oilseed worker strike extended... An Argentine oilseed workers’ strike extended into its seventh day today as wage negotiations with firms remained stalled. The strike has mainly affected terminals located north of Rosario along the Parana River, where more than 80% of Argentina’s agricultural exports are shipped. At least three dozen ships were still delayed on Sunday near Rosario.
APK-Inform raises Ukraine grain production, export forecasts... APK-Inform increased its forecast for Ukraine’s grain production by 2.24 MMT to 55 MMT, citing larger wheat and corn crops. The consultancy raised its 2024-25 grain export forecast by 2.64 MMT to 38.8 MMT, including 23 MMT of corn and 13.4 MMT of wheat.
Middle East tensions rise... A barrage of rockets fired by Hezbollah into Israel on Sunday night has further heightened tensions in the Middle East. The latest salvo was fired in support of the Palestinian people in Gaza and in retaliation for Israeli strikes in southern Lebanon, the militant group said in a statement. Meanwhile, the U.S. has bolstered its military presence in the Middle East by deploying the USS Abraham Lincoln carrier group, equipped with F-35C fighters, and the USS Georgia guided-missile submarine. This move aims to support Israel against further attacks from Iran and its allied militias. The U.S., Qatar, and Egypt have called for new Gaza cease-fire negotiations scheduled for Aug. 15. While Israel has agreed to participate, Hamas has expressed reservations, emphasizing the need to implement previous agreements.
Deadline for 2022 ERP is Aug. 14... If you suffered losses from natural disasters in 2022, application for Emergency Relief Program (ERP) aid must be submitted to FSA by Aug. 14. Advisors say that even if you qualified for Track 1, also consider applying for Track 2, as legal changes could affect its value in the future. Track 1 uses existing federal crop insurance or NAP data, while Track 2 is revenue-based for those who experienced a revenue drop due to natural disasters. Also: Make sure all required forms are on file with FSA within 60 days of the deadline, with a final submission deadline of Oct. 15, 2024.
The week ahead in Washington... Congress is on recess with focus in Washington on campaigns for the November elections. On the economic front, key inflation data will feature updated producer prices on Tuesday and consumer prices on Wednesday. Several Fed officials will also give speeches, which will be analyzed for indications of when timing and magnitude of an expected easing of monetary policy. Aside from the August crop reports, USDA is scheduled to release the first batch of FSA certified acreage data today.
Foreign investors withdraw record amount of money from China... China’s direct investment liabilities fell by nearly $15 billion from April to June, marking only the second time this figure has turned negative, according to data from the State Administration of Foreign Exchange. This decline is notable, as it was down by about $5 billion for the first half of the year. If this trend continues, 2024 could see the first annual net outflow of foreign investment from China since at least 1990, when comparable data began. The ministry of commerce reported that new foreign direct investment in China during the first half of 2024 was the lowest since the pandemic began in 2020. Meanwhile, Chinese firms increased their outbound investments, reaching a record $71 billion in the second quarter, up more than 80% from the same period last year. This surge in outbound investment is largely driven by projects such as electric vehicle and battery factories.
Wholesale beef prices firm... Choice boxed beef prices firmed 59 cents to $312.71 and Select rose 56 cents to $298.59 on Friday, ending a three-day skid in wholesale prices. Movement slowed to 108 loads. Packer margins remain solidly in the red, which is likely to limit their willingness to bid up for cash cattle.
Cash hog index decline accelerates... The CME lean hog index is down 90 cents to $91.90 as of Aug. 8. That’s the fifth straight daily decline and the biggest drop since September of last year. The pork cutout value firmed 43 cents on Friday to $98.66, ending a four-day skid.
Weekend demand news... Exporters reported no tenders or sales.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
· 10:00 a.m. Export Inspections — AMS
· 11:00 a.m. Crop Production — NASS
· 11:00 a.m. WASDE — WAOB
· 11:00 a.m. Cotton Ginnings — NASS
· 11:15 a.m. Cotton: World Markets and Trade — FAS
· 11:15 a.m. Grains: World Markets and Trade — FAS
· 11:15 a.m. Oilseeds: World Markets and Trade — FAS
· 11:15 a.m. World Agricultural Production — FAS
· 3:00 p.m. Crop Progress — NASS