Good Morning,

USDA Supply and Demand report out at 11am this morning. The average corn yield estimate of 174.9 bu/acre may be low given how good the Good/Excellent ratings have been recently (10% higher than last year). Despite the great ratings I would expect the government to be conservative in this report and make bigger adjustments in the August report when we get a state by state breakdown. Today’s estimates are attached below.

Weekly exports were soft again for the week ending 7/5/18 with corn at 15.8 million bu.(13 million below the 10 week average) Soybeans were the worst in the last 8 weeks at 4.7 million bu.(6 million below the 10 week average). I do not see last week’s lower export numbers as a big surprise as it was a shortened week due to the 4^th of July. I would also expect we will see these numbers continue to be low as we near the end of the old crop marketing season. New crop sales for both corn and beans were below their 10 week average, but as US prices continue to fall we are becoming much more competitive in the world market despite the tariffs.(review my commentary from Monday)

Despite the dry weather locally, the US drought monitor has gotten better for the upper Midwest over the last week while areas in Missouri and Kansas have gotten worse.

Billion Bushels

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

The Trump administration raised the stakes in its trade war with China yesterday saying it would slap 10% tariffs on an extra $200 billion worth of Chinese imports by August 30^th. Last week the US imposed 25% tariffs on $34 billion of Chinese goods to which the Chinese responded with matching tariffs on the same amount of US goods. The new tariffs announced yesterday targets more consumer goods than those covered under the tariffs imposed last week. President Trump has continued to state that he will take care of the US farmer, but this may take a while and several operations may suffer at the expense of the long term goal.

The USDA will release their monthly supply and demand numbers tomorrow at 11am. Expectations are for corn and soybean stocks in the 17-18 and 18-19 year to increase. Below are the trade estimates.

Billion Bushels

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

The corn market gave back Friday’s gains and then some over the last 24 hours.  We are down 15 cents in corn over the last two days and down 22 in soybeans in that same timeframe. This type of trade is why I believe producers should have firm offers in place to take advantage of any technical rallies that the markets may give us.

The markets will likely trader lower as traders begin to look towards Thursdays WASDE report and extended range forecasts that call for temperatures to moderate in the latter half of July.

Traders will continue to bearish the market until we see US and Chinese negotiators sit down for meaningful talks which there appears to be no solid timeline on.

Yesterday afternoons crop ratings showed US corn at 75% Good/Excellent compared to the five year average of 70%. This is 10% better than last year. Wisconsin came in at 83% Good/Excellent which compares to 75% on the five year average and 69% last year. The only states coming in below their five year average were Missouri and Kansas. Soybean conditions came in at 71% Good/Excellent for the US compared to 67% on the five year average. Wisconsin soybeans came in at 81% Good/Excellent.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

We finally saw some strength in the markets on Friday with corn up 8 and beans up 37. 25% tariffs on $34 billion of Chinese imports took effect Friday as well as retaliatory tariffs from China (which included soybeans). China cancelled about 370k metric tons of soybeans this morning (which equates to about 10-11 million bushels), but the old adage “sell the rumor, buy the fact” held true and lent itself to commodity strength to end the week.

Now that the tariffs are in place traders are watching to see what happens next. Will we see negotiations increase or will more tariffs be slapped on. So far, it is unclear how China intends on meeting its protein feed needs without eventually buying beans from the US. Brazilian beans continue to be offered at around a 17% premium to US beans. Prices for October out of Brazil are already trading at a 20% premium to those out of the Gulf, suggesting we are quickly closing in on the level where shipments can still work even with the 25% tariff in place. Regardless, other countries have taken advantage of the price discrepancy and bought US beans on the way down leading to weekly export sales that came in larger than expected.

Weather looks to be warm and dry this week with cooler and wetter conditions forecasted for next week across the corn belt.

The markets have opened 6 lower in corn and 16 lower in soybeans indicating that Friday’s short covering may have been overdone.

This could be a very volatile week with crop progress out this afternoon and the USDA’s Supply and Demand report released on Thursday.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

The markets will open at 8:30 am this morning after a shortened trade on Tuesday and 4^th of July holiday. Some look for a higher corn and wheat open due to ongoing talk of lower World 2018/19 supplies. Still the dominate factor is the trade wars with US and China, EU, Canada and Mexico. Deadlines for US tariffs on China are tomorrow. China has said they will retaliate immediately with tariffs of their own if this is not resolved. This could offer resistance to grains especially soybeans.

North Dakota, South Dakota, Minnesota and parts of Iowa saw rains yesterday. Precipitation appears to be light for the next 7-10 days across the major growing regions while temperatures are expected to moderate with highs mainly in the 80’s. The chances of any premiums being added to the markets from weather are becoming unlikely this late in the game.

Producers should have firm offers in for old crop slightly above the current levels. $3.30-3.40 range would be my target. New crop offers should be handled very similar with offers in the $3.40-3.50 range for fall delivery. I would not recommend any sales for next spring and summer at this time in hopes that our political issues can be resolved by that time. Over the last 10 years, 90% of the time the December futures have traded higher than the current level. Over the last 5 years it has traded higher 84% of the time.  I feel that fundamentally we are trading 25-30 cents below where the market should be due to trade wars.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com