Good Morning,

Corn and soybeans opened very strong last night, but despite its initial nickel plus gain prices have since filled those gaps. Corn and beans are currently trading lower this morning. Corn is down 8 cents and soybeans are down 10 cents. The hot and dry outlook for the next 10 days still remains in the forecast. There are some chances for rain in MN and here in WI mid-week, but the majority of the Corn Belt is expected to remain dry. Temperatures are expected to push 100 degrees across much of the U.S. growing region. The hot weather lingers at a time that isn’t so welcome for our crops and certainly adds some risk premium to the markets. The weekly crop progress report will be released after the close today and it is expected that there will be a decline in good to excellent ratings for corn and soybeans. This week, markets will be focusing on a break in the weather and looking for more precipitation along with keeping an eye on the exact path of Tropical Storm Barry’s remnants. I think if we don’t see more normal temperatures and added moisture more risk premium will be added to the markets here in the short-run.

Have a great day!

Drake Bliss
920-348-6817
dbliss@didionmilling.com

Good Morning,

Markets are a bit higher this Friday morning with corn currently up 6 cents and soybeans up 5 cents. Yesterday’s report really didn’t cause much excitement in trade and really only mattered for a short period of time. The report was traded on for what seemed like 30 minutes and the big highlights were the largest old crop corn carryout we have seen in 30 years along with numbers showing tightening global wheat supplies. Traders quickly moved on from the report and shifted their attention back to the weather. With a hotter and drier extended forecast, markets were steadily bought and making session highs by the close. Moving forward, I believe the markets will continue to focus their attention on the warm and dry weather expected for much of the Corn Belt. Patience seems to be running a bit thin regarding the uncertainty of this new crop and any threat to yield is going to keep the markets focus despite the large amount of old crop stocks that are being kept in storage. As long as the weather looks threatening, market prices will be well supported. With the markets being up, it gives producers a great opportunity to sell their crop at profitable levels. If you are sitting on old crop corn I would consider selling some amount in the days to come because some unexpected weather could cause a sharp response in prices.

Have a great day!

Drake Bliss
920-348-6817
dbliss@didionmilling.com

Good Morning,

Volume and trade action slowed through the overnight of trade as traders are waiting to see the USDA report that is set to be released at 11 a.m. The markets have consolidated over the course of the last 24 hours and corn and soybeans are currently down a cent this morning. Typically, the July WASDE report is a quiet one as the USDA adopts the June acreage number and leaves yield unchanged. With this year being a non-typical one, it will be interesting to see if the USDA breaks its normal tendencies and makes bigger changes to the supply side of the equation than in years past. This is impossible to know prior to the data being released and leaves the market susceptible to a surprise in trade this afternoon. However, market analysts have predicted what the numbers on the report could be and are as follows:

USDA 2019-20 corn and soybean production:
USDA July 2019-20 Estimate Average of analysts’ estimates Range of analysts’ Estimates USDA June Estimate
Corn Production 13.875 13.664 13.100 – 13.960 13.680
Corn Yield 166 165 162 – 167 166
Soy Production 3.845 3.883 3.738 – 4.100 4.150
Soy Yield 48.5 48.6 47 – 51 49.5

USDA 2018-19 U.S. grain and soybean ending stocks:
USDA July 2018-19 end-stocks estimates Average of analysts’ estimates Range of analysts’ estimates USDA June 2018-19 end-stocks estimates
Corn 2.340 2.197 2.065 – 2.295 2.195
Soybeans 1.050 1.044 0.935 – 1.137 1.070

USDA 2019-20 U.S. grain and soybean ending stocks:
USDA July 2019-20 end-stocks estimates Average of analysts’ estimates Range of analysts’ estimates USDA June 2018-19 end-stock estimates
Corn 2.010 1.692 1.450 – 1.975 1.675
Soybeans 0.795 0.812 0.558 – 1.040 1.045

The numbers that analysts are predicting set the tone for more of a bearish response in the corn market and more of a bullish response in the soybeans market. Though the initial reaction to the report may be sharp, I think the markets will shift their attention back to the weather and keep eyes on extended forecasts.

Have a great day!

Drake Bliss
920-348-6817
dbliss@didionmilling.com

Good Morning,

Ag markets are trading lower with corn down 8, beans down 4 and wheat off 6 to 8 cents. Technical selling and concerns over a bearish report from the USDA on Thursday have prices on the defensive to start the day. The funds are long almost 200k contracts of corn so a little profit taking following the last week’s recovery is not a huge surprise.

With 96% of the beans now planted according to the USDA, the trade will refocus its attention to crop conditions and how the wheat harvest is progressing. Wheat harvest is now 47% complete. Crop conditions still look good with 64% of the winter wheat crop rated Good-To-Excellent (GTE). Unsurprisingly corn gained 1% to 57% GTE while beans pulled back 1% to 53%.

Despite the potential for new business from China when and if trade negotiations pan out, the trade continues to struggle to rally back to pre-trade war price levels. A big part of that is the ongoing African Swine Flu (ASF) problem that has government officials culling animals. Additionally, the expansion of Chinese domestic production of soybeans just exacerbates the problem of the expanding stockpile of world supplies. Both are a direct result of the trade war and are likely to have lasting implications on just how much the Chinese will need to secure. The ASF has helped to encourage their population to seek out other types of proteins like beef. Likewise the increase in bean acreage over there will decrease their dependency on the US for soy.

The weather models are in fair agreement in calling for a tropical system to move out of the Gulf and over the Delta and Southeast for the next 7 to 10 days. The system looks like it will trek further east than we had seen in previous runs and bring meaningful rains to the Delta up through Illinois and Indiana. Beyond that it looks like we will see a return to more normal summer weather. Latest longer-term runs show no set up that is too threatening. We may get some ridging developing beginning around the 18th that could have temps across the Midwest heating up into the lower 90’s, but nothing that looks to be too strong.

Have a Safe Day!

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

Good Morning,

Markets have opened higher this morning due to the big shift in the extended weather forecast. Corn is currently up 2 and soybeans are up 3. Traders are definitely eyeing the hot and dry weather forecast that is expected to linger across much of the Corn Belt for the next 2 to 3 weeks. This is a pretty big shift in the weather pattern for much of the U.S. This change in weather should be beneficial for root depth and early crop development initially, but with the lack of rain expected traders are nervous to how this will affect yield. With the yield disputes still in question, markets will be extra sensitive to any weather concerns going forward. We will have our weekly crop progress report released this afternoon after the close of trade and this Thursday the July WASDE report will be released. We will see if any improvements in the crop conditions are enough to quell some of the fear regarding the yield debate or if the hot and dry forecast will keep the trend higher. If you are still sitting on any old crop corn, I would consider selling some amount as we are seeing better prices for the nearby months rather than the deferred. Also, I would recommend getting some new crop corn on the books and locked in at profitable levels that may not be here by the time of harvest.

Have a great day!

Drake Bliss
920-348-6817
dbliss@didionmilling.com