Good morning!
Corn and beans lower, wheat mostly firmer overnight... Corn and soybeans pulled back from Wednesday’s corrective gains overnight, while wheat was mostly firmer. As of 6:30 a.m. CT, corn futures are trading mostly 2 cents lower, soybeans are a nickel lower, SRW wheat is fractionally to 2 cents higher, HRW wheat is narrowly mixed and HRS wheat is 5 to 7 cents higher. The U.S. dollar index is around 80 points higher and front-month crude oil futures are modestly weaker.
Weekly Export Sales Report out this morning... For the week ended July 11, traders expect:
| 2023-24 expectations (in MT) | 2023-24 last week | 2024-25 expectations (in MT) | 2024-25 last week |
Corn | 500,000-800,000 | 538,331 | 25,000-400,000 | 116,496 |
Wheat | NA | NA | 225,000-600,000 | 240,351 |
Soybeans | 150,000-600,000 | 207,952 | 50,000-400,000 | 191,255 |
Soymeal | 80,000-350,000 | 53,118 | 0-150,000 | 22,770 |
Soyoil | 0-15,000 | 9,695 | 0-10,000 | (3,500) |
Support for disaster aid package... There is bipartisan and bicameral support for a disaster aid package, but action is unlikely until after the August recess, according to Politico. FEMA predicts the Biden administration will nearly deplete its Disaster Relief Fund, which currently has about $9 billion, resulting in a $6 billion shortfall before the new fiscal year starts in October. President Joe Biden requested $4 billion in emergency cash. However, immediate action is hindered by ongoing regular funding bills and other political issues. It could be handled either ahead of the Sept. 30 shutdown deadline or as part of a stopgap funding measure. Of note: The House Ag Committee will hold a hearing July 23 on “Financial Conditions on Farm Country.” This comes amid declining commodity prices and reports of some bankers calling in loans.
Thune expects new farm bill in 2025... Senate Minority Whip John Thune (R-S.D.) anticipates the new farm bill will be completed in 2025. Speaking at a CNN/Politico event during the Republican National Convention, Thune, who aims to become the GOP Senate leader, expressed doubts about finishing the bill this year. He emphasized its importance to his state’s economy but acknowledged significant differences that will likely delay its completion until next year. Thune hopes the GOP will be in the majority when the bill is finalized.
India plans to ease rice export restrictions... India is likely to cut the floor price for basmati rice exports and replace the 20% export tax on parboiled rice with a fixed duty on overseas shipments, government sources told Reuters. India is expected to lower the minimum export price for basmati rice to $800.00 to $850.00 per metric ton from $950.00 a ton currently to boost shipments. New Delhi would also review the export ban on non-basmati white rice after assessing the progress of rice planting, the sources said. The country’s rice stocks at state warehouses jumped to 48.51 MMT as of July 1, the highest ever for the month and nearly 19% more than last year, according to the Food Corporation of India.
China pledges host of reforms, including ‘high-quality development’... “High-quality development is the top mission of building a modern socialist country,” Chinese leaders pledged after the Third Plenum of the Communist Party, according to the official Xinhua news agency. Chinese leaders pledged to modernize the country’s industrial complex, expand domestic demand, curb debt and property sector risks, as well as implement financial and fiscal reforms. Beijing wants to improve social security, healthcare and income distribution systems and introduce land reforms. China will “enhance the role of market mechanisms in the economy, create a fairer and more dynamic market environment and optimize the efficiency of resource allocation. Restrictions on the market will be lifted, while effective regulation will be ensured to better maintain order in the market and remedy market failures.”
China’s fertilizer exports plunge amid restrictions... China’s exports of urea plummeted to 140,000 MT during the first half of this year, down 86.2% from the same period last year. Exports of di-ammonium phosphate (DAP) during the January to June period dropped 37% from a year ago to 1.51 MMT, while mono-ammonium phosphate (MAP) exports were virtually unchanged at 930,000 MT.
China to probe EU pork for anti-dumping using sampling method... China has put three companies from the European Union at the center of its anti-dumping investigation into pork products from the bloc. Beijing has chosen Danish Crown A/S, Vion Boxtel BV, and Litera Meat S.L.U. — the top three exporters of pork products in the region to China — to determine if dumping has occurred and assess the damage to the domestic sector, the commerce ministry said. The investigation, which began June 17, will look into pork and its by-products imported from the EU after the bloc decided to impose anti-subsidy duties on Chinese electric vehicles.
China’s June pork imports continue to lag sharply from year-ago... China imported 90,000 MT of pork in June, up 12.5% from May but 33.5% less than last year. Through the first half of 2024, China’s pork imports totaled 520,000 MT, down 45.3% from the same period last year.
Cash cattle trade steady... Light cash cattle trade started at steady $188.00 prices in the Southern Plains on Wednesday. Initial cash cattle trade not only came earlier in the week than anticipated but at stronger prices. Cash bids remained scarce in the northern market, though expectations are now for steady/firmer trade as supplies there are tighter.
Cash hog index rises again... The CME lean hog index is up 18 cents to $88.80 as of July 16, marking the first three-day string of gains since late-May/early June. August lean hog futures finished Wednesday at a $2.85 premium to today’s cash quote.
Overnight demand news... Japan purchased 115,208 MT of milling wheat via its weekly tender, including 55,318 MT U.S. and 59,890 MT Canadian. Algeria purchased between 700,000 and 750,000 MT of optional origin milling wheat, most of which is expected to be sourced from the Black Sea region.
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
· 7:30 a.m. Weekly Export Sales — FAS
· 8:00 a.m. Food Expenditure Series — ERS
· 2:00 p.m. Livestock, Dairy, and Poultry Outlook: July 2024 — ERS
· 2:00 p.m. Sugar and Sweeteners Outlook: July 2024 — ERS