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Prices as of Closing 8/26/24
Corn
Soybeans
Wheat
In this edition:
Market Actions: Insights on marketing actions to consider.
Harvest Headlines: More mixed news.
Weather Impact: The summer heat is starting to have an impact on the grain markets, and we could see its effects on the markets in the next few weeks.
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
No new major market action triggers.
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.
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 artificial intelligence (AI) models is still suggesting that this 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
With harvest looming even closer, and with potentially record-breaking harvests on the line. Corn prices stumbled moderately lower, while soybeans caught a bit of a break following a run of bullish demand and a flurry of flash sales last week. Wheat prices were mixed on Monday.
Ahead of Monday afternoon’s crop progress report from USDA, analysts expect the agency to trim corn quality ratings by one point, with 66% of the crop in good-to-excellent condition through August 25. Individual trade guesses ranged between 66% and 67%.
Following their near week-long Crop Tour Pro Farmer released their projected US yield number at 181.1 bpa on Friday afternoon, with production at 14.979 bbu. That came in below the 183.1 bpa and 15.147 bbu estimates from USDA.
This morning’s Export Inspections report showed 894,295 MT (35.21 mbu) of corn shipped in the week that ended on August 22. That was down 25.9% from last week but still 49.07% above the same week last year and the largest for the current week going back to 2018. The top destination was Mexico at 363,654 MT, with 178,398 MT headed to Columbia. Marketing year to date shipments have totaled 51.034 MMT (2.09 bbu) with just over a week left in the marketing year.
Traders await USDA’s weekly crop progress numbers for soybeans, which recently have reflected a strong crop that’s maturing on schedule. USDA last week said 81% of the U.S. crop was setting pods as of August 18, just above the 80% five-year average.
Weather Impacts
Soybean Market Impact
The record projected soybean yield of 53.2 bushels per acre may also be at risk due to the drying effect of this heat wave. Soybeans are currently in their pod-filling stages, making them susceptible to heat stress. Soybean prices saw only fractional declines on Friday, August 23, faring better than corn in the face of the acreage report.
Wheat Market Impact
Wheat prices were mostly lower following the USDA's acreage and stocks reports. The heat wave's direct impact on wheat is less pronounced, as much of the U.S. wheat crop has already been harvested.
Weather Outlook and Further Market Implications
The heat is expected to continue into the early part of the week of August 26, potentially further impacting yields. However, some areas are anticipated to see a return to more seasonal temperatures later in the week. Adding to concerns, there's potential for rapid onset drought in the Eastern Corn Belt and Mississippi Delta during late August and early September. This could further stress crops and impact yields.
The full impact of this late-season heat wave on crop yields and market prices will likely become clearer in the coming weeks as harvest approaches and more accurate yield estimates become available.
Weather Related Impacts Survey
Crop | Price Movement (Aug 23) | Primary Factors |
|---|---|---|
Corn | ↑ 3.5%+ | Higher plantings, yield concerns |
Soybeans | ↔ Fractional | Yield concerns, offsetting acreage report |
Wheat | ↗ 0.75% to 1.5% | Bearish acreage and stocks reports |
Extended Commentary
As we move deeper into the harvest season, the grain markets face various challenges and opportunities. The ongoing volatility has made it difficult to make clear-cut decisions, but the overall outlook, particularly with our AI models indicating potential price rises, offers some cautious optimism.
The recent heatwave has begun to show its effects, especially on the soybean market, where drying conditions could threaten the record projected yield of 53.2 bushels per acre. With soybeans in their crucial pod-filling stage, any additional stress could significantly impact yields and, consequently, prices. While soybean prices have remained relatively steady, the full impact of the weather will become more apparent as we approach harvest.
Corn prices have seen a moderate decline, influenced by the anticipation of strong harvests and recent USDA reports showing slightly lower-than-expected yield projections. However, the potential for rapid-onset drought in key areas like the Eastern Corn Belt and Mississippi Delta adds another layer of uncertainty. This could create additional pressure on yields and lead to further market fluctuations in the coming weeks.
Wheat prices have also been mixed, reflecting the varied impacts of the heatwave and the recent bearish USDA acreage and stock reports. With much of the wheat crop already harvested, the heat's direct impact is less significant, but the market continues to react to other factors, including global supply concerns and export dynamics.
We must remain flexible and responsive to changing conditions as we navigate these uncertain times. The coming weeks will be critical in determining how these weather patterns and market developments play out. Stay informed, keep a close eye on the latest data, and be prepared to adjust your marketing strategies as needed to take advantage of any emerging opportunities.
