Soybeans–
Soybeans moved 2 1/2 cents higher in the overnight session, but closed lower on Tuesday. Soybean conditions are now 69% good/excellent after declining 1% from the week prior. Soybean conditions were 68% at this time last year. StoneX has Brazil’s soybean crop at 177.2 mt, up from 172.8 mt previously. Brazil’s exports are estimated at 110 mt, compared to 106 mt last year. U.S. weather continues to be favorable, with no weather premium added. Central and eastern soybean areas are expected to see above-average rainfall in the 6-10 day forecast.
For the week ending July 31, soybean exports were 612k mt at 94.2% of the USDA estimate. Cumulative inspections are 11.1% above last year. The 5-year average for this time of year is 91.7%.
September Soybeans (ZSU25) settled at 971 (-3), high of 983, low of 970. New crop November Soybeans (ZSX25) settled at 990 (-3), high of 1002, low of 989. Cash price is at 959 (+3)
September Bean Meal (ZMU25) settled at 277 (unchanged) high of 282, low of 275.8
September Bean Oil (ZLN25) settled at 53.77 (-0.63) high of 59.94, low of 53.71
The September Meal to Oil ratio (50.75% Meal – 49.25% Oil)
ZSU25 Moving Averages – (972) 5-day, (994) 20-day, (1015) 50-day, (1017) 100-day, (1021) 200-day
ZSX25 Moving Averages – (991) 5-day, (1011) 20-day, (1026) 50-day, (1025) 100-day, (1026) 200-day
ZMU25 Moving Averages – (271.1) 5-day, (272.7) 20-day, (284.8) 50-day, (294) 100-day, (303.9) 200-day
ZLU25 Moving Averages – (54.89) 5-day, (55.14) 20-day, (52.65) 50-day, (49.90) 100-day, (46.98) 200-day
The Commitments of Traders report for the week July 22 showed soybean Managed Money traders bought 21,412 contracts to their bringing their net short to -10,866 contracts. Producer/Merchants sold -19,646 contracts bringing their net short position to -101,647 contracts. Non-Commercial & Non-Reportable traders net position was -13,480 contracts.
The Commitments of Traders report for the week ending July 22 showed meal Managed Money traders bought 3,273 contracts, moving to a net short position of -129,743 contracts. Producer/Merchants sold -3,960 contracts bringing their net short position to -34,832. Meal Non-Commercial & Non-Reportable traders hold a short position of -78,416 contracts.
The Commitments of Traders report for the week ending July 22 showed bean oil Managed Money traders were net long 55,326 contracts after buying 12,105 contracts. Non-Commercial & Non-Reportable traders net long position was 86,179 contracts.
CORN –
September Corn (ZCU25) settled at 381 (-5), high of 386, low of 380. New crop December Corn (ZCZ25) settled at 402 (-5). Cash price is 408 (-4)
Higher yields estimates continue to roll in as weather has remained favorable. StoneX updated its yield estimate at 188.1 bpa. Last week, another research firm released at estimate of 186 bpa. These analyst estimates, if materialized, would have a way bigger bearish impact on the market than the USDA’s estimate from July at 181 bpa. A raise in yield would come with increased ending stocks and a higher stocks/use. The August WASDE report is next Tuesday. It will be very interesting to see how the USDA estimates yield. In my opinion, the USDA will likely keep yield unchanged or raise yield slightly. Corn conditions are now 73% good/excellent, unchanged from the week prior. Last year at this time corn ratings were 67% good/excellent. The states with biggest increases in corn conditions were Michigan, Colorado, and Tennessee. The states with worsening conditions include, Kansas, North Carolina, Texas, and Ohio. Harvest is about 1/4 complete in Louisiana.
For the week ending July 31, corn exports were 1.2 mmt at 90.6% of the USDA estimate. The 5-year average for this time of year is 81.6%.
ZCU25 Moving Averages – (388) 5-day, (397) 20-day, (411) 50-day, (425) 100-day, (436) 200-day
ZCZ25 Moving Averages – (409) 5-day, (416) 20-day, (428) 50-day, (438) 100-day, (444) 200-day
The Commitments of Traders report for the week ending July 22 showed that corn Managed Money sold -2,610 contracts bringing their net position to -177,365 contracts. Producer/Merchants bought 12,062 contracts bringing their net position to -28,232. Non-Commercial & Non-Reportable traders net short position was -199,643 contracts.
WHEAT –
September Chicago Wheat (ZWU25) settled at 508 (-8), with a high of 517, low of 507. December Wheat (ZWZ25) settled at 528 (-8). Chicago Wheat has a cash price of 487 (-3). September KC Wheat (KEU25) settled at 504 (-12).
Wheat continued to move lower on Tuesday, after closing 1/2 cent lower overnight. Resistance in the September contract is 500 then 488, if neither one of these resistance levels can hold then wheat could make another significant move lower. However, I think it is likely that there’s a bounce around 500, which is the psychological resistance. HRS conditions are now 48% good/excellent, down 1 point. HRS conditions are well off the wheat rating at this time last year, which was 74%. Rains in the northern plains are expected to slow harvest pace this week. Russia gave importers 4 weeks of zero import tax, but they have now raised their export duty to 19.4 rubles starting on Wednesday. There’s not much bullish sentiment right now, except for the strength in exports, which are 8.7% above last year at this time. Cumulative inspections are 3.91 mmt.
For the week ending July 31, wheat exports were 340k mt at 16.19% of the USDA estimate. The 5-year average for this time of year is 15.6%.
ZWU25 Moving Averages – (517) 5-day, (535) 20-day, (546) 50-day, (555) 100-day, (575) 200-day
ZWZ25 Moving Averages – (537) 5-day, (556) 20-day, (568) 50-day, (577) 100-day, (595) 200-day
The Commitments of Traders report for the week ending July 22 showed that Managed Money traders in the wheat market were net short -52,041 contracts, having decreased their short position by 8,446 contracts. Producer/Merchants sold -6,882 contracts to bring their net short position to -1,123 contracts. Non-Commercial & Non-Reportable traders were net short -65,351 contracts.
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