Good Morning,

NASS reported crop conditions for corn at 57% Gd/Ex and 55% Gd/Ex for soybeans. Rating were up 1% from last week. 27% of the corn crop is in the dent stage vs 46% of the 5 year average and 71% is in the dough stage, vs 87% on average. 79% of the beans are setting pods with average at 91%. Almost 20 million acres of beans are not setting pods yet.
While there is no threat of frost in the 15 day forecast, some private forecasts look for a cool down in the coming weeks, and a loss of growing degree days looks imminent according to some forecast. The Artic Polar Vortex is expected to break South from Canada and move in the Central US. Temps similar to the Spring are forecast to return, cooler nights in the 40 and 50’s.
Chinese officials deny that any call took place over the weekend about China wanting to hold talks geared toward a resolution to the current trade war so for now the saga continues. While traders will continue to look for news from the trade issue, it has become something to trade when there is no other news as most anticipate this to drag on. Personally I believe the Chinese will hold tight until the 2020 US Presidential election to see if they can get a new leader to negotiate with. Regardless of when a deal gets worked out, the US famer has taken a hit that he will not recover from. The Chinese have found several new sources and alternatives for the commodities that we used to export.

Corn is currently down 1 and soybeans are down 8 to start the day.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

Good Morning,

Commodities were showing some life this morning after President Trumps early morning tweet calling Chinese President Xi a “great leader representing a great country and that talks are continuing”. This is a complete 180 from Friday’s comments where he called Xi our enemy. With nothing else to grab headlines traders are looking for something to give them direction and this was it overnight. In other trade news the US and Japan appear to have come to an agreement over the weekend which should allow for increased US products to be exported to Japan. (Agricultural, Industrial products and digital commerce)
Last week’s Pro Farmer tour pegged the US corn crop at 163.3 bpa versus the latest USDA forecast of 169.5. On average the Pro Farmer tour has been 3 bpa below the USDA final number in January. Last week’s tour results have had very little impact on traders as demand continues to be the issue regardless of what yields come out this year. Poor ethanol margins that have resulted in plants slowing down or shutting down in the east over the last couple months is now hitting WI. There are official and unofficial reports of plants that have slowed down in the Badger state due to poor margins.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

Good Morning,

Markets are on the slide again this morning after China revealed its counter measures to the US tariffs expected to be implemented on September 1. Reports are that China will put 5% to 10% import tariffs on $75 billion in US goods coming into the country. The tariffs will be applied in two steps, matching the US tariffs implementation on September 1 and December 15. The total tariff list includes over 5000 goods coming from the US to China. China also said that is will resume additional tariffs on US auto and auto part imports, while indicating that crude oil is among the products that will face a 10% tariff.
Reports that President Trump will meet with the EPA and USDA office to talk about different options regarding ethanol and the exemptions to 31 oil companies that was proposed. The blow back in the industry has made the Trump administration look further into the impact this policy would make and possibly take a different course.
Pro farmer will release their US corn yield sometime later today. The tour found Iowa corn at 182.8 down from last years 188 bpa, and NASS estimate of 191 bpa. Minnesota corn was estimated at 170 bpa vs. NASS 173 bpa.
We may not agree with the USDA’s projections of the size of this years crops (acres and yield), due to prevent plant and late planted acres that will not meet historical yield potential but those numbers may be irrelevant. If no one can afford to purchase a product the lack of demand will keep prices from rallying. The law of supply and demand is at work and needs to be kept in mind by producers that are expecting a big move in the markets in the coming months. The lack of demand is and will keep prices from rallying unless there are some dramatic changes. The markets always end up at the level where supply and demand meet and as of right now that price appears to be lower.

Have a safe day!

Garry Gard
920-348-6844
ggard@didionmilling.com

Good Morning,

Corn is struggling to find its direction on the CBOT as traders continue to watch the Pro Farmer tour reports and news regarding the Biofuels industry. Lower projected yields continue to come from the tour which is not in line with the USDA’s numbers from last week. This is supportive to the markets, but is being met with reports of more and more ethanol plants slowing down or shutting down due to terrible margins. President Trump is set to meet with the USDA’s Perdue and the EPA’s Wheeler today to discuss potential options to support Biofuel producers.
The ProFarmer Tour pegged corn in Illinois at 171.1 bpa, down 10 bpa from the USDA’s August estimate. On the Iowa leg, corn yields in western part of the state were better than expected, but surveyors will still need to work their way through the eastern portion today before can get an accurate feel of just how ProFarmer’s estimates stack up against the USDA forecast for Iowa of 191 bpa.

It will be interesting to see just how ProFarmer ends up calculating their estimates when they release them during their final meeting Friday. The lack of muturity has been a big problem throughout the Tour, but in particular across the northern third of Illinois. Normally participants take more than 200 samples in order to help build their forecast; however, so much corn was planted in June and beans in July that they were only able to get just a fraction of the sample size they were expecting due to the lack of maturity.

Late yesterday a story broke about the USDA pulling all of its staff from the annual crop tour after an employee was threatened by an angry farmer. Frustrations have only grown over the past few weeks after this month’s WASDE crop report appeared to ignore the damage from this spring’s historic flooding. When you factor in all the additional stress placed on producers due to the trade war with China, falling farm income and tighter credit conditions, it is not tremendously surprising that farmers have begun to vent.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

Good Morning,

Weakness in the markets yesterday as rains passed through Iowa, Illinois and Indiana with total rainfall much better than the models had predicted. The markets have opened lower this morning with corn down 1 and wheat down 3.
Prices are usually at their lowest of the season in corn and wheat going into the end of August. All the storage and dp contracts for corn and beans go off at the end of the month. The 31st of August, many times has marked the low price period for the year. The threat of an early frost or subpar yields appear to be the biggest thing producers are holding on to help move prices higher. Unfortunately basing your marketing on these two items may not be beneficial. End users have enough on the books for the first quarter, and there is no rush to further book grain. Prices also have a habit of holding back until crop insurance prices are set in October.
The Pro Farmer corn yields for Indian were 161.5 BPA, compared to 166 by NASS. Indiana soybean pod counts were 924 vs 1,312 last year. Nebraska corn yield was 172.5 vs NASS of 186. Nebraska pod counts were 1,210 vs 1,299 last year. We’ve thought that beans will be down in yield between 20 and 40 percent on most farms with short beans, late development and low pod counts.
Yesterday morning POET, the nations largest ethanol producer, announced that they will be making some operational changes due to market conditions.
1. POET Bio-refining – Cloverdale will idle production indefinitely.
2. Half of POET bio-refineries will run at reduced production rates
We have had reports of many other plants slowing or closing down due to poor
I would advise producers that are sitting on old bushels that need to move before harvest to lock in basis very soon. Once the calendar turns to September the gates will open regardless of cash prices as most producers and elevators will empty out their remaining stock to make room for this years crop. Producers needing to make new crop sales should consider making fall basis sales vs. the CH to give them a little more time to market once the crop is in the bin.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com