Ag Market Insights is dedicated to bringing you timely information to help you consistently get the most money for your crops. Our team painstakingly goes through mountains of information and data and distills insights into a format that you can consume in a few minutes.
We have a little better news for you today, as most indications are that crop prices are starting to go in the right direction. The government is also offering an opportunity to earn some extra money by renting your cows to the Secret Service to secure rooftops that are too steep and dangerous for Secret Service Agents. Ed Macky made a bundle of extra money by renting his cow out for three Trump rallies in Michigan. What’s more, his cow served the country well by spotting two would be assassins well before any Secret Service agents saw them.
In this edition:
Market Actions: Insights on marketing actions to consider.
Harvest Headlines: Some positive news! Fundamentals are getting a little better.
AI Models: Our advanced artificial intelligence (AI) predictor models suggest prices are going to steadily climb.
Volatility Measures: An overview of some not so pretty volatility numbers.
The information provided in this newsletter is for informational purposes only and should not be considered financial advice. We recommend consulting with a commodities broker and financial advisor before making any commodities decisions.
Market Actions
Volatility continues to be problematic and is making it very difficult to make market decisions. The volatility seems as though it is likely to continue (see volatility section at the end of this newsletter).
The outlook for Corn, Soybeans, and Wheat is not great, but it is looking better. We are not even close to being out of the woods yet, but indications are that soybean could get back to $10 a bushel. However, that is the ceiling. There is also a good chance they could get back in the 7s.
Due to volatility, a lot of experts are recommending selling all 2023 bushels, most of 2024, and even 50-75% of 2025 bushels. If you are selling far ahead, you might want to look at some put options as well as the money strike prices.
Our AI models is suggesting that this week crop prices are going to start trending in the right direction. The floors and ceilings for corn, soybeans, and wheat look like they should all rise.
The chart below shows that corn is fighting to climb back to the five-year average. Soybeans and wheat are also starting to fight back to their five-year average. This is more evidence that crop prices are trying to get back to “normal.”
Seasonal Chart - Corn
Harvest Headlines
EIA data from this morning showed ethanol production back up 5,000 barrels per day from the week prior to 1.072 million bpd in the week of August 9. Stocks of ethanol were down 413,000 barrels to 23.354 million barrels. Blender and refiner inputs of ethanol totaled 932,000 bpd, the most since late May.
Soybean export sales are seen as totaling between 100,000 and 500,000 MT in Thursday’s Export Sales report for the 2023/24 crop. Sales for the 2024/25 marketing year are estimated in between 400,000 MT and 1 MMT for the week that ended in August 8. Meal bookings are expected to total between150,000 and 650,000 MT between the current and next marketing year. Bean oil is estimated in a range of net reductions of 3,000 MT to sales of 25,000 MT.
Indications are that the Federal Reserve will be aggressive with rate cuts the rest of the year, although it did dial back those expectations a bit this morning, moving toward 3 rate cuts by year’s end instead of 4. The VIX is trading near 17 this morning, while the dollar index is trading near 102.4. Yields on 10-year Treasuries are trading near 3.86%, while yields on 2-year Treasuries are trading near 3.98%. Crude oil prices are mixed to higher at this hour, while the grain and oilseed markets are mixed to weaker.
California Air Resources Board hit the industry with an unexpected blow when it released proposed changes to the state's Low Carbon Fuel Standard. The latest proposed revision would require feedstocks, such as soybeans and canola, to meet new sustainability criteria, while also capping the use of oilseed feedstock use at 20%. The proposal is an apparent attempt to further push the fuel industry toward electric vehicles. Oilseed feedstocks could be used beyond 20%, but their carbon intensity score beyond that would be equal to fossil fuels, meaning they'd lose their subsidy value that makes them work economically as a feedstock. Rather, the policy favors use of other feedstocks, such as used cooking oils. The new policy proposals apply to green diesel fuel - biodiesel and renewable diesel - and not to sustainable aviation fuel. However soybean oil is not a preferred feedstock for SAF. The proposal wouldn't go into effect for a couple of years, if approved, but this is a long-term negative for soybean demand. California policies tend to set the precedent for other states to follow regarding the biofuels.
AI Models
for CME Corn, Soybeans, and Wheat
Our AI models ingest and process billions of data points to create models that have accuracy of 95%+. Our models are as accurate as any model you can find. Just like with any model, they are not always completely accurate, especially in times of high volatility. The models are designed to be a bit of information that can help inform you marketing decisions.
One Week AI Corn Predictions
One Week AI Soybean Predictions
One Week AI Wheat Predictions
Volatility
Corn
Soybeans
Wheat
Extended Commentary
The market landscape remains complex as we head deeper into the harvest season. While some signs of price recovery have emerged, they come amid persistent volatility. Our AI models indicate a potential upward trend for corn, soybeans, and wheat, yet the current market environment calls for cautious optimism. The fundamental pressures—driven by oversupply and subdued demand—continue to weigh heavily on prices.
In such a volatile market, the decision to sell 2023 and 2024 bushels, and even a portion of 2025 bushels, isn't taken lightly. Technical indicators, including recent moving averages, suggest we may have yet to see the bottom. The market’s reaction to evolving fundamentals will be critical, and positioning yourself to respond quickly is essential.
Additionally, external factors such as the Federal Reserve's tentative approach to rate cuts and the California Air Resources Board's proposed changes to biofuel policies add another layer of complexity. If other states follow California's lead, these developments could have long-term implications for soybean demand. It’s more important than ever to stay informed and be prepared to adjust your strategy as new information comes to light.
As you plan your next steps, closely monitor market fundamentals and technical indicators. The path ahead is uncertain, but you can navigate these challenges effectively with careful planning and informed decisions. We aim to provide you with the insights you need to make the best choices for your operation in these unpredictable times.
