Chicago Agriculture Commodities Finished Down on the Week

Chicago Agriculture Commodities Finished Down on the Week

$CORN, $WEAT, $SOYB

 Chicago Board of Trade (CBOT) grains futures finished lower on week which ended 11 August, mostly on National Agricultural Statistics Service’s (NASS) Bearish US crop yield.The most active Corn contract for December delivery fell 6.25 cents weekly, or 1.67%, to 3.7475 bu.

September Wheat delivery dropped 15.5 cents weekly, or 3.53%, to 4.3925 bu.

November Soybean fell 11.75 cents weekly, or 1.24%, to 9.45 bu.

December Corn fell 6.25 cents, which was entirely a function of NASS’s Bearish US yield surprise. Friday’s trade was moderately higher, and there’s a general consensus that NASS’s 1st year weight guess is too high, to a degree that is yet to be determined.

Market analysts maintains a US Corn yield of 166 BPA, but there is evidence to suggest an even lower number by the October or November crop reports.

South American Corn exports continue to dominate world trade, but demand has rallied Brazilian and Argentine basis bids substantially. It is too late to turn Bearish South American cash prices.

Wheat futures again closed sharply lower on a Bearish August World Agricultural Supply and Demand Estimates (WASDE) report and ongoing fund liquidation.

An upward revision was fully expected to Black Sea production, but the United States Department of Agriculture (USDA) in its report this week raised combined Ukraine and Russian Wheat production to 7.5-M tonnes, which no doubt exceeded expectations and also pushed major exporter stocks/use noticeably higher.

Soybean were on both sides of Unchanged through the week and finished lower.

Short covering ahead of the USDA’s August Crop Report offered support in the 1st half of the week, while a much larger than expected yield estimate sent the market sharply lower Thursday.

The trade had been positioned for a US Soybean yield around 47 BPA, while NASS estimated a yield of 49.4 BPA.

Based on much weaker conditions and some crop analyst assessment of Midwest fields, most traders’ view is that the August USDA yield estimate could be the highest of the year.

Crop ratings are expected to be flat to 1% lower Monday as cool temps in the last week have helped offset limited rainfall.

However, much of the Midwest is in dire need of rain, while the weather models projected limited rains and building heat in the next 10 days.

Have a terrific week.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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