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.
Prices as of 10pm 8/25/24
Price | Day | % | Weekly | Monthly | YoY | |
Soybeans | 952.27 | 11.23 | 1.19 | 1.6 | -14.17 | -30.58 |
Wheat | 504.75 | -6.25 | -1.22 | -4.76 | -7.72 | -20.1 |
Corn | 391 | -2.5 | -0.64 | -0.38 | -6.46 | -19.92 |
I think a little drink of water will help get these crop prices going in the right direction. It did the trick for this combine.
In this edition:
Market Actions: Insights on marketing actions to consider.
Harvest Headlines: More mixed news.
AI Models: Our advanced artificial intelligence (AI) predictor models suggest prices are going to steadily climb.
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.
Farmer sales of old crop corn or the pricing of basis contracts put pressure on the front-end September futures. With First Notice Day approaching next Friday, producers will need to make decisions on pricing basis contracts early next week, potentially adding further selling pressure to the market.
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.
Harvest Headlines
Grain prices are still lingering close to their recent lows as the Pro Farmer’s tour wraps up and prepares to release a national yield estimate after the market closes this afternoon. Although they discovered some disappointing corn in Minnesota yesterday, it's likely to have only a minimal effect on what is expected to be another optimistic yield estimate, reflecting the largely favorable conditions of the 2024 U.S. growing season.
Yesterday’s updates to the U.S. Drought Monitor showed most overly dry conditions have stayed west of the Mississippi River this summer. In the Midwest, only 21.5% of the region is affected by drought through August 20, up modestly from the prior week’s reading of 19.8%. In the Plains, 63.1% of the region is currently affected by drought, also up slightly from the prior week’s mark of 62.8%. Only 7% of corn acres are currently in an area experiencing drought.
Domestic demand has remained strong, with crush margins reportedly between $2.10 and $2.60 per bushel in the Corn Belt, providing crushers with a strong incentive to purchase cash soybeans. This increased demand aligns with the recent rise in export activity, but the market's attention is largely on the expected large crop likely to be harvested this fall.
Weekly Commitment of Traders data showed spec funds in corn futures and options adding another 8,889 contracts to their net short position, at 257,869 contracts by August 20. Commercials added another 5,036 contracts to the net long position at 14,669 contracts by Tuesday.
Weekly Corn Export Sales data old crop corn export commitments at 55.936 MMT, or 38% above the same time last year. That is 98% of the USDA projection lagging the 103% average pace, though actual Census data is running ahead. New crop forward sales are now 7.924 MMT, a 7.8% improvement above the same week last year.
A sharp rise in soybean oil prices, coupled with another significant soybean sale to unknown buyers, drove soybeans higher at the end of last week, allowing them to recover more than half of losses from last Thursday. The surge in bean oil was bolstered by stronger crude oil prices and market rumors that Brazil is importing Argentine bean oil for biofuel production.
FranceAgriMer reported a one-point increase in French soft wheat ratings this week, bringing them to 49% in the good/excellent category, with the harvest now finished. Corn ratings held steady at 76% good/excellent, a drop from 82% at the same time last year.
Logistics in moving corn bushels to the Gulf of Mexico ports may become a concern soon as Mississippi River levels are dropping and could be at a stage to put restrictions on barge traffic by Early September.
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.
Corn Price Changes
AI Corn Prediction Through Nov 30, 2024
Soybean Price Changes
AI Soybean Prediction Through Nov 30, 2024
Wheat Price Changes
AI Wheat Prediction Through Nov 30, 2024
Extended Commentary
As we head into the final stretch of summer, the grain markets continue to grapple with volatility and mixed signals. The Pro Farmer tour's findings and ongoing drought concerns in the Plains have added complexity to an already challenging market environment. Despite these headwinds, there are glimmers of optimism, particularly with our AI models suggesting a potential upward trend in crop prices.
The continued strength in domestic soybean demand, driven by robust crush margins and increased export activity, provides a positive outlook for soybeans. However, the broader market remains cautious as the Pro Farmer tour's yield estimates are expected to reinforce the notion of a large upcoming harvest. This could temper any significant price rallies in the near term.
Corn, on the other hand, faces its own set of challenges. With First Notice Day approaching next week, producers are under pressure to make key decisions on pricing basis contracts, which could add further selling pressure to the market. The recent rise in soybean oil prices and the strong domestic demand for cash soybeans have helped lift soybean prices, but corn and wheat have not fared as well, with prices remaining close to their recent lows.
Logistical concerns are also beginning to surface, particularly with the Mississippi River levels dropping, which could impact the movement of corn bushels to Gulf ports. This situation will need to be closely monitored as we move into September.
Overall, while the market continues to navigate a challenging environment, the potential for a gradual price increase in corn, soybeans, and wheat offers a ray of hope. As always, staying informed and ready to adapt to changing conditions will be vital to making the most of the opportunities. With volatility likely to persist, keeping a close eye on market developments and being prepared to act swiftly when opportunities arise is crucial.
