Good morning!
Day 3 Crop Tour results for Illinois and western Iowa…
Scouts on day 3 of the Pro Farmer Midwest Crop Tour Wednesday determined an average corn yield of 190.71 bu. per acre in Illinois, down from last year’s 196.3 bu. per acre estimate and but up from the three-year Tour average of 185.62 bu. per acre. Soybean pod counts in a 3’x3’ square averaged 1,249.70 for Illinois, down from an average of 1,279.79 in 2021 and but up from the three-year Tour average of 1,174.95.
In western Iowa, average corn yields for Districts 1, 4 and 7 were 181.12, 180.8 and 173.7 bu. per acre, respectively, compared to 183.96, 201.1 and 192.47 bu. per acre, respectively, in 2021. The averages for the previous three years for Districts 1, 4 and 7 are 183.37, 188.74 and 187.83, respectively.
Western Iowa pod counts for Districts 1, 4 and 7 averaged 1,089.74, 1,258.94 and 1,223.85, respectively, compared with 1,089.35, 1,225.24 and 1,367.61 averages for 2021. The averages for the previous three years for Districts 1, 4 and 7 are 1,066.2, 1,199.57 and 1,250.92, respectively.
On Day 4 of the Crop Tour today, scouts will sample more fields in Iowa as well as fields in southern Minnesota. The Tour concludes tonight in Rochester, Minnesota.
Corn futures gain seventh straight session overnight... December corn rose a seventh consecutive session and remains near a two-month high amid concern Midwest heat will curtail production, with Pro Farmer Crop Tour results indicating smaller crop prospects in western Iowa. Soybean futures also rose while wheat was mixed. At 6:45 a.m. CT, corn was 7 to 9 cents higher, soybeans were 1 to 3 cents higher and wheat was 4 cents lower to 3 cents higher. Front-month crude oil futures were up slightly and the U.S. dollar index was about 300 points lower.
Russian missile strike kills at least 25 in Ukraine… Ukrainian officials said at least 25 people were killed in an attack on a train station as Russia conducted missile strikes across Ukraine on Wednesday. The attack was one of several Russian strikes carried out in the region on Ukrainian Independence Day. Separately, Russia’s defense minister today said Russian authorities will provide the necessary assistance for an inspection of the Zaporizhzhia nuclear plant.
China’s central bank announced a one trillion ($146 billion) yuan stimulus plan… China’s State Council announced a 19-point package focused mainly on infrastructure to counter severe headwinds facing the world’s second-largest economy. It comes on top of a series of other stimulus measures such as financing for banks and last week’s interest-rate cut from the central bank. Even with the new spending, Goldman Sachs is sticking to its prediction that China will expand just 3% in 2022, well short of the 5.5% target set by the state at the start of the year.
Trade flows slowed in Q2, WTO says… the World Trade Organization said merchandise trade flows slowed last quarter and will likely stay weak in the second half. That’s still consistent with the WTO’s forecast for 3% growth in global merchandise trade in 2022. The pressure on trade growth is coming from the Russian war in Ukraine but there was some support from the lifting of some Covid lockdowns in China.
California to ban sales of all new gas-powered cars beginning in 2035... California regulators are expected to ban the sale of all new gasoline-powered vehicles beginning in 2035, a major step for the largest auto market in the U.S. and one that the Democratic government hopes can accelerate the transition toward electric vehicle adoption. The rule is expected to take effect Thursday following a vote by the California Air Resources Board, according to the New York Times. It also sets interim targets to help phase out the sale of internal combustion engine models: By 2026, it states, 35% of new cars sold must be zero-emissions vehicles — an amount that climbs to 68% in 2030. Currently, just 12% of new cars sold in the state are electric vehicles.
Line forming to adopt California’s zero-emissions auto plan… At least 12 other states are already in line to adopt California’s zero-emissions vehicle. “Affordability is the biggest issue,” Autotrader analyst Michelle Krebs told Axios. “I don’t know if there will be enough vehicles at an affordable price by 2035.”
Manchin wants Democrats to deliver on promised permitting language… Top Democrats and the White House promised Sen. Joe Manchin (D-W.Va.) to pass a separate bill this fall to speed up the permitting process for new energy projects, an important issue in Manchin’s home state. Manchin is hoping to attach the permitting package to a stopgap funding bill that must pass by Sept. 30 to prevent a government shutdown. “It either keeps the country open, or we shut down the government. That’ll happen Sept. 30, so let’s see how that politics plays out,” Manchin told West Virginia MetroNews this week. The bill would need the votes of at least 10 Republican senators — or more if any Democrats or independents refuse to support it — to overcome a filibuster.
Shorter environmental reviews under NEPA… A leaked draft of the National Environmental Policy Act (NEPA) indicates the bill would shorten environmental reviews and require President Biden to designate 25 energy projects of “strategic national importance,” among other provisions. NEPA requires federal agencies to assess the environmental effects of their proposed actions. The bill would expedite not only fossil fuel projects such as natural gas pipelines but also the transmission lines needed to carry clean electricity.
CF Industries will halt ammonia production at its remaining UK plant… The fertilizer producer is response to soaring natural gas prices, a move that could reduce carbon dioxide supply crucial to the food industry, according to Bloomberg.
Citi cuts its outlook for shippers Maersk, Hapag-Lloyd and Zim… The bank cited reasons including: a reduction in global consumption, flagging U.S. home sales and rising inflation. They’re all negative omens for an industry that moves about 80% of global trade. Meanwhile, Drewry said the spot rate for the benchmark route from Asia to the U.S. fell to $4,949 per 40-foot container, marking the first time the index has slipped below $5,000 since December 2020.
Sabato’s Crystal Ball made three race ratings changes… Rep.-elect Pat Ryan’s new New York district in November moved from toss-up to leaning Democratic, Marc Molinaro’s new New York district in November moved from leaning Republican to toss-up, and the Ohio Senate race between J.D. Vance and Democratic Rep. Tim Ryan moved from likely Republican to leaning Republican.
The Cook Political Report’s Amy Walter, Jessica Taylor and Dave Wasserman revised their predictions for the House… They now project Republicans to gain 10 to 20 seats. In May, their House outlook was a GOP gain of 20-35 seats. House editor Dave Wasserman said on Twitter that it is “not out of the question” for Democrats to maintain control of the chamber.
Republicans have no advantage in overall support for Congress… Based on a Pew poll, despite anemic ratings for Biden, 44% of registered voters said they’d support the Democratic candidate and 42% were in favor of the Republican candidate.
Cash cattle prices appear to be slipping… Live cattle futures fell to two-week lows Wednesday amid wholesale price weakness and signs of eroding cash prices. Live steers averaged $143.31 this week through Wednesday morning, down about $3.50 from last week’s average. Wholesale beef remains near a three-month low but retailers appear to be stepping up purchases on weaker prices. Choice beef cutout values rose 3 cents Wednesday to $262.83 on strong movement of 121 loads.
Hog futures extend slump as cash market nosedives… Lean hog futures sank to a seven-week low Wednesday on expectations the cash will continue slipping. Pork cutout values fell another $2.09 to $102.99, a three-month low fueled partly by a decline of over $6 in bellies. Movement was a strong 305.5 loads. The CME lean hog index is down $1.18 to $118.00, around a one-month low.
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.