Good Morning,

Markets are sharply lower this morning with corn down 5 and soybeans down 9 and wheat down 8. Last night’s crop conditions ratings from NASS showed the nations corn crop at 72% G/E compared to the five year average of 66%. 92% of the crop is in the silking stage while 39% is in the dough stage. Soybeans came in at 73% G/E with 85% blooming and 59% setting pods. All of these are ahead of the five year average.
StoneX (FC Stone) estimated that the corn yield would be a record 182.4 bpa and beans a record 54.2 bpa. If realized the corn yield would add more than 325M bu. and 365M bu. in bean production to the balance sheets. For corn that would mean that it’s carryout would top 3B and beans in excess of 700M bu. While the corn estimate was 2% over trend, the bean estimate was nearly 9% over trend and an outright bearish figure.

Hand Sanitizer – Didion has hand sanitizer available in large containers (55gal drums). If you or your business is in need or you know of someone who could use larger quantities, please contact Garry Gard at 920-348-6844 for more details.

Have a Safe Day!

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

Good Morning,

Corn is unchanged, soybeans are mixed and wheat is off 10 to start the week and month.
The soap opera continues as the Trump administration’s threat to ban TikTok, the viral teen phenom, and other Chinese-owned apps could significantly hamper their access global user data, which is an immensely valuable resource in a modern internet economy. Any US decision, which Secretary of State Pompeo said would come “shortly,” is likely to be followed by a similar pressure campaign that prompted some allies to ban Huawei.

This will surely raise the tensions between the US and China leading traders to debate whether or not it will have an impact on the Phase 1 trade deal.

Corn and soybean crop ratings are expected to hold steady or even possibly gain a tad after last week’s rains across the southern half of the Midwest and Delta. Those rains could prove especially significant for soybeans where the rains would produce the most benefit.

Have a Safe Day!

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

Good Morning,

Prices are sharply lower this morning with corn down 5, soybeans down 14 and wheat down 6 on better than expected crop ratings in yesterday afternoons report.

Despite ratings slipping in Iowa, the recent rains helped boost ratings in Illinois, Indiana and Ohio. NASS pegged crop ratings for both corn and beans at 72%. Yield estimates for corn, beans and spring wheat are on the rise and traders know that the feedback farmers are providing now will be the data included in August 12th crop report.
The historically high ratings indicate a yield potential that is some 5% higher than trend and puts corn yield in the neighborhood of 184-187 bpa and the beans anywhere from 51 to 52.5 bpa. Yields of that magnitude will add substantial bushels to the 2020 production potential and ultimately ending stocks. We have to remember that for every bushel above trend adds nearly 85M bu. to the balance sheets of both.

Traders will continue to monitor the situation with China to see if they look to purchase any soybeans on the pullback in the market. With any supply issues off the table for moving the market higher, the CBOT is now in a position of finding prices that help improve demand which means lower prices!

With a higher quality crop on the horizon, there has been a lot of talk about end users and elevators adjusting discount schedules for the new crop to discourage producers from delivering old crop(2019) on new crop(2020) contracts. Higher Test Weight, Foreign Material and Damage discounts are expected as they don’t want to deal with the poor quality the 2019 crop gave us. Farmers with old crop bushels have basically run out of time and need to empty out the bins ASAP.

Have a Safe Day!

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

Good Morning,

Corn is down 2 and beans are up 2 to start the week. Some support in the bean markets as rising prices in China helped to underpin the markets. Corn in Dalian (Major port city in China) was up $0.17 and soy meal was up $6.70. However, the strong gains have traders questioning if we will continue to see the Chinese continue with their large orders like we saw last week. There are a couple of theories as to why Ag prices are rising so quickly in China. The first is that their grain demand is just better than expected after flooding in the far southern parts of the country has damaged stored supplies. The second is that with political tensions between the US and China rising once again that Beijing will pull back on its Phase 1 commitments and leave China with a tight supplies between now and when the South American harvest begins in January. In June, China imported a record 11.2 MMT of soybeans (mostly from Brazil) and corn imports were up 25% as well. Normally we would see these massive influx of beans going to state reserves, but it appears as though the Chinese are in need of more feed grains. The rise in corn looks to be mostly speculative with Chinese farmers expected to begin harvesting there in another 6 to 7 weeks.
I would not recommend chasing any potential rallies in the market and advise producers to get sales on the books ASAP. The political rhetoric between the US and China is heating up again and could devastate prices even more. With a big crop on the horizon for the US and COVID numbers continuing to rise at an alarming rate the next ten days could be quite telling for prices for the balance of the year.

Have a Safe Day!

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

Good Morning,

Markets are mixed with corn up 1, beans down 3 and wheat up 1 cent to start the day. Grain markets are trying to bounce back while beans are struggling a little due to the favorable weather outlook and new political turmoil with China.

China vowed retaliation after the U.S. forced the closure of its Houston consulate, prompting stocks to fall in one of the biggest blows to diplomatic ties between the two countries in decades.
The US government gave China 3 days to close its consulate in America’s fourth-most populous city in an “unprecedented escalation,” A Chinese Foreign Ministry spokesman told a regular briefing Wednesday in Beijing. China planned to “react with firm countermeasures” if the Trump administration didn’t “revoke this erroneous decision.”
The State Department subsequently confirmed in a statement that it had ordered the consulate closed “to protect American intellectual property and Americans’ private information.” It said international agreements required diplomats to respect the laws and regulations of the host nation and not interfere in its internal affairs.
There really is no idea what form the Chinese retaliation might take, but I would assume that this is a direct threat at the Phase 1 Trade Agreement. To this point no plans have been set forth for Phases 2 & 3. China could very easily pull back on their US Ag purchases due to the rising political tensions.

Weather in the US suggests we will produce a big corn crop. Growers with old crop are running out of time. Longer term, there is the potential for export demand developing with a weaker $USD. But that is a story for 2021 & beyond and not going to help old crop or the 2020 crop that is looking bigger every day.

Have a Safe Day!

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