Good morning!
Beans and corn firmer, wheat weaker overnight... Soybeans posted strong corrective gains overnight, which pulled corn mildly higher. Wheat traded mostly lower. As of 6:30 a.m. CT, corn futures are trading a penny higher, soybeans are mostly 11 to 12 cents higher, winter wheat markets are 1 to 2 cents lower and spring wheat is fractionally lower. The U.S. dollar index is nearly 400 points lower and front-month crude oil futures are trading just below unchanged.
StoneX estimates above-trendline corn, soybean yields... Commodity brokerage StoneX estimated U.S. corn production at 15.207 billion bu. on a yield of 182.3 bu. per acre. The firm estimated the soybean crop at 4.483 billion bu. on a 52.6 bu. per acre yield. In July, USDA projected corn production and yield at 15.1 billion bu. on a trendline yield of 181 bu. per acre. USDA’s July soybean projections were 4.425 billion bu. for production and 52 bu. per acre for yield. The StoneX estimates are based on survey of its customer and assume USDA’s harvested acreage.
France’s wheat harvest continues to lag amid rainy weather... France’s wheat harvest reached 67% as of July 29, according to the country’s ag ministry, well behind the five-year average of 84%. Heavy rains continue to hamper harvest progress and hurt yields and crop quality.
FAO food price index slips amid drop in grains... The UN Food and Agriculture Organization global food price index slipped 0.2% in July, ending a three-month string of gains, as a drop in cereal grains outweighed increases in vegoils, meats and sugar, while the dairy index was almost unchanged. The July index was down 3.0% from last year. Compared to year-ago, prices declined 12.0% for cereal grains and 17.8% for sugar, while they rose 0.8% for meats, 7.2% for dairy and 4.0% for vegoils.
China to start setting hard targets for cutting carbon emissions... China is planning a shift in the way it aims to control greenhouse gases, favoring hard targets for total carbon emissions over its current method of measuring them against economic growth. China has set targets that aim to reduce energy use or emissions per unit of gross domestic product, a system it refers to as intensity. That approach has allowed China to tout environmental successes even as its total emissions soared, so long as they didn’t grow faster than the overall economy. Starting in 2026, China will set targets for overall volumes of emissions, although at first they will remain secondary to intensity targets, according to a State Council work plan. After China reaches peak emissions — currently targeted before 2030 — overall volumes will become the main targets as intensity is de-prioritized, according to the plan. China currently aims to reach net zero by 2060.
Chinese exchange can trade options for hogs, eggs and corn starch... China’s securities regulator has approved the trading of eggs, corn starch and hogs options on the Dalian Commodity Exchange.
WRDA clears the Senate... The Water Resources Development Act of 2024 (WRDA 2024) unanimously passed the U.S. Senate on Thursday. This biennial legislation authorizes the U.S. Army Corps of Engineers (Corps) to undertake various projects related to flood control, navigation and ecosystem restoration across the United States. The House passed its version of WRDA legislation on July 22. The next step involves a conference process between the EPW Committee and the House Transportation and Infrastructure Committee to resolve differences between the two bills.
China halts some U.S. meat... China halted imports of meat and meat products from the Swift Beef Company plant in Grand Island, Nebraska, and Lineage Logistics cold storage facilities in Grand Island, Nebraska, and Windsor, Colorado, effective July 30. This marks the second Swift Beef facility banned by China, following a May 27 suspension of imports from the Swift plant in Greeley, Colorado. No reason was given for the suspensions. In the case of the Greeley, Colorado, plant, U.S. officials reportedly found traces of ractopamine in meat destined for export to China, leading to the suspension.
FTC to investigate food prices... Federal Trade Commission (FTC) Chair Lina Khan announced plans for an inquiry into food prices to understand why grocery prices remain high and why grocers’ profits are elevated despite decreasing costs. The effort aims to ensure no illegal business practices are inflating prices. Khan will request a vote by FTC commissioners, with approval expected since Democrats control the agency. The inquiry will collect sales, cost and profit data from grocery retailers. A recent FTC study indicated large grocery chains gained an advantage during the pandemic and may have used inflation to increase profits. The timeline for the inquiry is unclear, but its results could influence future regulatory actions.
Food companies starting to offer discounts... Big food manufacturers are slowing price hikes and offering discounts to win back customers frustrated by inflation, aiming to boost sales, the Wall Street Journal reports. Companies like Kraft Heinz and Mondelez International are increasing investments in coupons and introducing smaller, cheaper product packs. This strategy could benefit trucking companies, which have faced a prolonged slump in freight demand, by increasing the volume of goods moved to grocery stores.
New vaccine to decrease cow methane emissions... A new vaccine for cows aims to reduce their methane emissions by 20% by decreasing their tendency to burp. The vaccine works by producing antibodies in cows’ saliva that attack methanogen bacteria in their stomachs. Initial trials showed a 13% reduction in emissions, with plans to improve and distribute the vaccine widely within five years. Since agriculture is the largest human-made source of methane, primarily from cattle, this could significantly impact greenhouse gas emissions. The beef and dairy industry accounts for 14.5% of all emissions.
Cash cattle, futures drop... Cash cattle trade started at $1.00 to $2.00 lower prices on Thursday. That helped weigh on cattle futures, which posted sharp losses but given already-steep discounts, the bulk of the pressure was tied to fund liquidation on the first trading day of the month. Thursday’s low-range closes in futures could lead to followthrough selling to close out the week.
Late-season climb in cash hog index extends... The CME lean hog index is up another 45 cents to $93.53 as of July 31, extending the string of gains to 14 consecutive days. Traders have narrowed the discount August hogs hold to the cash index, but it still stood at 38 cents on Thursday’s close. After two days of declines, the pork cutout value firmed 98 cents to $105.86 on Thursday.
Overnight 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
· 2:00 p.m. Agricultural Cash Rent — NASS
· 2:00 p.m. Agricultural Land Values — NASS
· 2:00 p.m. Peanut Prices — NASS
· 2:30 p.m. Commitments of Traders — CFTC