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Grains pull back from Monday’s gains overnight... Corn, soybeans and the winter wheat markets retreated from Monday’s gains during the overnight session. As of 6:30 a.m. CT, corn futures are trading 2 to 3 cents lower, soybeans are 15 to 16 cents lower and wheat futures are 3 to 4 cents lower. The U.S. dollar index is around 500 points higher and front-month crude oil futures are trading just above unchanged this morning.
Fear-based selling eases overnight but nerves still high... Global stock markets were mostly higher overnight after Monday’s sharp plunges as fear-based selling eased. There are technical clues stock market bears may have run out of gas after a steep three-week downdraft. But this could be a “Turnaround Tuesday” pause and trading action the rest of this week will be extra important in determining if the big selloff has concluded. Geopolitically, worries about a broader Middle East war are still present as Israel is bracing for a major retaliatory attack from Iran and its proxies. The U.S. and its allies worked to head off an Iranian attack on Israel and avert a wider regional war.
Cordonnier raises U.S. corn, soybean forecasts... Crop consultant Dr. Michael Cordonnier raised his U.S. corn and soybean yield forecasts 0.5 bu. each to 182 bu. and 52.5 bu. per acre, respectively, noting August started without any widespread problems and beneficial weather. That pushed his production estimates to 15.02 billion bu. for corn and 4.42 billion bu. for soybeans.
Corn and spring CCI ratings slip, modest improvement for soybeans... USDA rated 67% of the corn crop as “good” to “excellent” and 10% “poor” to “very poor.” The soybean crop was rated 68% “good” to “excellent” and 8% “poor” to “very poor.” On the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500-point scale, with 500 representing perfect), the corn crop slipped 0.2 point to 374.6. The soybean crop improved 2.2 points to 368.5. Both crops remain rated well above year-ago at this time. USDA rated 74% of the spring wheat crop as “good” to “excellent” and 4% “poor” to “very poor.” On the CCI, spring wheat dropped 1.9 points to 380.8, though that was still 59.1 points (18.4%) above last year at this time. Click here for details.
Crop Progress Report highlights… Following are highlights from USDA’s crop progress and condition update as of Aug. 4:
· Corn: 67% good/excellent (68% last week); 88% silking (88% average); 46% dough (38% average); 7% dented (5% average).
· Soybeans: 68% good/excellent (67% last week); 86% blooming (84% average); 59% setting pods (56% average).
· Spring wheat: 74% good/excellent (74% last week); 97% headed (99% average); 6% harvested (10% average).
· Cotton: 45% good/excellent (49% last week); 91% squaring (91% average); 60% setting bolls (59% average); 8% bolls opening (7% average).
· Winter wheat: 88% harvested (86% average).
China’s rice growing regions facing scorching heat... Extreme heat is baking China’s main rice-growing regions as crops near maturity, spurring calls for increased irrigation, despite strains on the country’s power system and water supplies. Daily temperatures of 37 C to above 40 C (99 F to 104 F) are expected to hit parts of Hubei, Hunan, Jiangxi, Anhui and Zhejiang through Sunday.
Farmer group says Brazil soy area will increase slightly in 2024-25... Area planted to soybeans in Brazil will increase at a slower rate for 2024-25 than previous years as prices are near a four-year low, the president of farmers group Aprosoja Brasil said. Brazil’s soybean plantings rose 4.5% to 46 million hectares in 2023-24 after a 6% jump in 2022-23. “I don’t know if it (soybean expansion in 2024-25) will reach 1%,” the official said.
Cattle futures oversold... Heavy long liquidation in live cattle futures, including Monday’s fear-driven plunge, swung the market from overbought to short-term oversold in just six trading sessions. Monday’s mid-range close and filling of the opening gap suggests potential selling exhaustion, though a drop through yesterday’s low would likely trigger another leg lower.
Rally in cash hog index stalls... The CME lean hog index is down a nickel to $93.59 as of Aug. 2, ending a 15-day string of gains. After Monday’s losses, August lean hog futures stood at a $2.44 discount to today’s index quote.
Overnight demand news... Japan is seeking 83,445 MT of milling wheat in its weekly tender. Egypt tendered to buy 30,000 MT of soyoil and 10,000 MT of sunflower oil – all optional origin.
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
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