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Grains face pressure overnight... Soybeans faced followthrough selling overnight, while corn and wheat dropped more than they gained Monday. As of 6:30 a.m. CT, corn futures are trading 3 to 4 cents lower, soybeans are 9 to 13 cents lower, SRW wheat is 11 to 12 cents lower, HRW wheat is 14 to 16 cents lower and HRS wheat is 12 to 14 cents lower. The U.S. dollar index is modestly firmer and front-month crude oil futures are around 50 cents lower.
Corn CCI improves, ratings slip for soybeans and spring wheat... USDA rated 68% of the corn crop as “good” to “excellent” and 9% “poor” to “very poor.” The soybean crop was rated 67% “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 improved 1.3 points to 374.8, while the soybean crop slipped 0.6 point to 366.3. USDA rated 74% of the spring wheat crop as “good” to “excellent” and 4% “poor” to “very poor.” On the CCI, spring wheat dropped 1.3 points to 382.7. Click here for details.
Crop Progress Report highlights… Following are highlights from USDA’s crop progress and condition update as of July 28:
· Corn: 68% good/excellent (67% last week); 77% silking (76% average); 30% dough (22% average).
· Soybeans: 67% good/excellent (68% last week); 77% blooming (74% average); 44% setting pods (40% average).
· Spring wheat: 74% good/excellent (77% last week); 94% headed (96% average); 1% harvested (3% average).
· Cotton: 49% good/excellent (53% last week); 87% squaring (84% average); 54% setting bolls (46% average).
· Winter wheat: 82% harvested (80% average).
Cordonnier leaves U.S. yield, production forecasts unchanged... Crop Consultant Dr. Michael Cordonnier left his corn yield and production forecasts at 181.5 bu. per acre and 14.97 billion bu., respectively, noting July was generally favorable for corn pollination. He kept his soybean yield and production estimates at 52 bu. per acre and 4.39 billion bu., respectively, saying August weather must remain favorable to achieve strong yields.
Indigenous groups pull out of working group on Brazil’s Ferrograo railway... Indigenous people who see a threat to their ancestral lands from the construction of a railway to carry grains to a port in the Amazon pulled out of a work group created by the Brazilian government last year to advance the project. The Munduruku and Kayapo people, along with tribes from the Xingu reservation said in a letter to the transport ministry the work group was not doing its job of discussing the 1,000-km (620-mile) Ferrograo railway with all parties. The groups say the railway would lead to deforestation and affect the lands of 16 Indigenous peoples “all this to increase the profits of large transnational companies that export soybeans and corn.” Brazil’s Supreme Court last year suspended the plan pending more studies on the impact of the controversial railway.
Thailand raises rice export forecast... Thailand expects to export 8.2 MMT of rice this year, up from a previous forecast of 7.5 MMT, boosted by demand from major markets, expected higher production and a weak baht, the commerce ministry said. That would still be 6.5% lower than last year’s level. The country’s rice exports through the first half of the year totaled 5.08 MMT, up 25% from the same period last year.
A post-pandemic boom in U.S. manufacturing is slowing due to declining consumer demand... The Wall Street Journal reports manufacturers are responding by laying off employees and reducing production to manage falling orders and rising inventories. Deere has reduced its hourly workforce by about 15% since November and is cutting production to avoid excess inventory. Agco plans to cut 6% of its global salaried workforce by year-end. Polaris is reducing shipments to dealers as discretionary spending declines. Higher interest rates, rising operating costs, a stronger U.S. dollar and lower commodity prices are contributing to the slowdown in factory activity nationwide. This deceleration follows pandemic-induced supply imbalances and rapid shifts in consumer demand.
China’s Politburo vows to step up macro policies to aid economy... China will step up its macroeconomic policy and counter-cyclical adjustments and expand domestic demand by stimulating consumption, state media reported, following the Politburo planning meeting. China’s ruling Communist Party pledged to make boosting consumer spending a greater policy focus, as weak domestic demand threatens the nation’s annual growth target despite an export boom. Officials also sought to reassure on long-term prospects, calling the problems faced by China “temporary pains” as the economy transitions from old to new drivers.
China’s FDI continues to plunge... Foreign direct investment (FDI) into China plunged 29.1% from year-ago to 498.91 billion yuan during the first half of this year, a record decline for the period. About 12.8% of the total, or 63.75 billion yuan went into the high-tech manufacturing industries, up 2.4 percentage points from the same period last year.
Euro zone Q2 GDP highest in five quarters... GDP in the euro zone expanded 0.3% on a quarterly basis and 0.6% annually in the second quarter, the largest annual gain in five quarters. Despite the improved growth, the economic sentiment indicator eased marginally, conveying the greatest extent of pessimism in the economy since February. Consumer confidence rose to the highest level since February 2022, while industrial sentiment dropped to the lowest since July 2020.
USDA extends comment period on livestock competition rule... USDA’s Agricultural Marketing Service (AMS) has extended the comment period for its proposed rule on Fair and Competitive Livestock and Poultry Markets by 15 days, moving the deadline to Sept. 11. Previously, comments were due by Aug. 27. The rule aims to define unfair practices as those that harm market participants and the market.
Strong performance by wholesale beef... Wholesale beef prices firmed $1.04 for Choice to $314.81 and $4.06 for Select to $301.52 on Monday. Despite the price strength, movement was strong at 145 loads. Even with that wholesale market strength, packer cutting margins remain solidly in the red as the average cash cattle price climbed $1.54 last week to $195.21.
Cash hog fundamentals continue to strengthen... The CME lean hog index is up another 44 cents to $92.29 as of July 26, matching the mid-May high and marking the 11th straight daily gain. The pork cutout value firmed $1.61 to $106.78 on Monday, the highest level since mid-August 2023. The firming pork cutout has kept packer margins in the black, giving them incentive to keep raising cash prices.
Overnight demand news... Japan is seeking 119,145 MT of milling wheat in its weekly tender.
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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