Good Morning,

Corn is currently trading up one, and soybeans down nine. This coming week brings the ProFarmer Tour, which will give real data from fields across the Corn Belt. Coverage will be well maintained after each day, as this is a great benchmark for what can be expected come fall. Both NAFTA and Chinese trade war talks are remaining positive, though nothing solid has come out yet.

Markets aren’t expecting any huge rallies, with the large crop expected, make sure to take advantage of small rallies like we saw yesterday. If you have old crop remaining, September corn is at $3.40 cash. Get offers in if you believe there will be a small rally or call today and ask about other specialty contracts we have to get the bins cleaned out.

Have a Great Day!

Mitch Giebel
920-348-6861
mgiebel@didionmilling.com

Good Morning,

Grain markets opened higher this morning with corn up 4 and soybeans up 17. Soybeans are getting support from news that broke last night that the Chinese are sending a delegation to Washington DC later this month to discuss a solution to the trade war. There are also talk that China has entered the bean market with rumors of 15 cargos bought last week and 12 cargos bought early this week for September. The majority of the soybeans are coming from Brazil with 1 cargo coming from Argentina. Weekly export sales released this morning show old corn at 13.3 million bu. and new corn at 41.1 million bu. New crop sales are the largest in the last ten weeks. Old crop soybean sales were 4.9 million and new crop beans were 21.0 million. New crop is slightly above the ten week average.
Ethanol production for the week averaged 1.072 million barrels per day which is down 2.55% from last week but up 1.23% from a year ago. Ethanol stocks are up 5.4% compared to a year ago with production up 2.34% while gasoline demand is down 1.22%. Report out today showed that agricultural export prices fell 5.3% in July from the previous month, which is the biggest drop since October 2011.

Today’s jump in the markets is great news, but producers need to keep in mind that these are just rumors of talks that will/may happen and there is no resolution. We also need to remember the size of the crop that is in the fields now is going to put a lot of pressure on the markets in about a month when harvest begins in the I states.

Have a Safe Day!

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

Good Morning,

The selling continues!! Corn is down 4 and soybeans are down 8 as last Friday’s WASDE reports continue to weigh on the markets. The report that was a copulation of producer and field sample surveys forecasted record yields in both corn and soybeans. Corn came in at 178.4 bpa and soybeans at 51.6 bpa. Higher production in both resulted in greater ending stocks, particularly soybeans where the stocks to use ratio jumped to 18.44%. Corn stocks to use ratio is currently projected at 11%. The current price of corn on the CBOT is the lowest price we have seen with the stocks to use ratio this low since the inception of the RFSII mandate. The 178.4 bpa appears to be strongly driven by higher population counts combined with kernel length counts. The remainder of the season will prove whether the USDA’s assumptions of test weight support the 178 number.
It was interesting to note that the majority of the increase in yield came from less than half of the major corn producing states. Crop problems in some states were more than offset by the following states:

Illinois = 20 bpa above trend
Indiana = 16 bpa above trend
Iowa = 12 bpa above trend
Nebraska = 12 bpa above trend

Despite the record yield projections in corn, the market in my opinion is still undervalued considering the stocks to use ratio. Historically a stocks to use ratio of 10-12% equates to a cbot price of $4. We are currently trading at $3.70 for the CZ18 contract. Is this underpriced due to tariff issues, or will we see the market come back to the $4 level without tariff resolutions is the question. I believe that without some tariff resolution, we will not see $4 on the CBOT prior to harvest.

Have a Safe Day!

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

Good Morning,

Markets were quiet overnight and should open the same this morning as traders await the 11am release of production estimates from the USDA. This will be the only news traded today and could set the tone for the coming weeks as harvest in the south begins to work its way north. Below are the estimates for today’s report. Be sure to check back at 11am for today’s numbers.

Production (Billion Bu)
USDA August 10 Average Estimate USDA July
Corn Production 14.586 14.411 14.23
Yield 178.4 176.2 174.0
Soybean Production 4.586 4.407 4.310
Yield 51.6 49.6 48.5

Ending Stocks (Billion Bu)
USDA August 10 Average Estimate USDA July
Corn 2.027 2.0210 2.0270
Soybeans .430 .460 .465

Have a Safe Day!

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

Good Morning,

Corn and soybeans are both slightly lower this morning with no excitement in the markets ahead of tomorrow’s USDA report. Traders appear willing to sit on their hands with most of their positions until they get confirmation of the USDA’s state by state surveys tomorrow. Producers need to keep in mind that tomorrows numbers are the first official survey of the summer row crops and often produces some serious volatility and surprising yields. The trade is anticipating record large yields, so anything below 176 bpa for corn and 50 bpa for soybeans could open the door to higher prices. Anything above these levels could mean that the highs are in and the market will trend back to the lows made in July.
Ethanol production in the week ending August 3rd was the second highest on record at 1.1 million barrels/day. Stocks were up from 923 million to 963 million gallons. This increase in stocks has resulted in margins in ethanol dropping dramatically this week.
Weekly export sales reported this morning showed old crop corn right on pace with the ten week average at 21.8 million bu. New crop export sales came in at 26 million bu. which is the lowest in the last 4 weeks, but ahead of the ten week average of 20.0 million. Corn exports are ahead of last year and the USDA’s projections for 2018 with only 4 weeks left in the marketing year. Soybeans are well below last year, but right on pace with the USDA’s projections for 2018.
My advice would be for all producers to look at making some cash sales ahead of Fridays report and look to lock in basis sales for new crop corn. (October forward) If we see the CBOT rally, we are guaranteed to see basis depreciate like it has the last two years with adequate carryout.

Have a Safe Day!

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