Soybeans–
Soybeans traded higher today due to hotter weather and likely some technical buying, as yesterday soybeans made a fresh 4-month low. Analysts are predicting an increase in yield at 53 bpa for next week’s August WASDE report. The July WASDE report put yield at 52.5 bpa. Production is estimated at 4.374 bb versus 4.335 in July. New crop ending stocks are anticipated at 358 mb compared to 310 mb in July. Weather has been favorable and offered no threat so far. Brazil’s July exports hit a new record high for the month.
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 974 (+8), high of 975, low of 963. New crop November Soybeans (ZSX25) settled at 993 (+9), high of 994, low of 983. Cash price is at 959 (-6)
September Bean Meal (ZMU25) settled at 276.1 (+3.5) high of 276.9, low of 271.5
September Bean Oil (ZLN25) settled at 53.50 (-0.22) high of 53.88, low of 53.27
The September Meal to Oil ratio (50.79% Meal – 49.21% Oil)
ZSU25 Moving Averages – (971) 5-day, (991) 20-day, (1012) 50-day, (1016) 100-day, (1020) 200-day
ZSX25 Moving Averages – (990) 5-day, (1008) 20-day, (1024) 50-day, (1024) 100-day, (1026) 200-day
ZMU25 Moving Averages – (274.7) 5-day, (272.7) 20-day, (283.6) 50-day, (293.1) 100-day, (303.4) 200-day
ZLU25 Moving Averages – (53.65) 5-day, (54.92) 20-day, (52.71) 50-day, (50.02) 100-day, (46.91) 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 384 (+4), high of 386, low of 379. New crop December Corn (ZCZ25) settled at 407 (+5). Cash price is 396 (-6)
Brazil’s July corn exports were down 31.5% y/oy, most likely due to the slower than usual harvest pace. Weather is expected to be hotter over the next 2 weeks, however no real weather threat is expected. Since weather has been favorable, analysts are calling for higher yield. The average estimate for the August WASDE is 184.3 bpa; the USDA estimated yield at 181 bpa in July. Looking at the USDA’s historical decision making they tend to overstate yield in the August report on years with good crops. The EU crop is forecasted lower at 55.9 mt, down 1.5 million from the prior forecast. It’s not surprising to see buyers below $4, but upside may be limited if yield is raised on Tuesday.
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 – (384) 5-day, (395) 20-day, (409) 50-day, (424) 100-day, (436) 200-day
ZCZ25 Moving Averages – (405) 5-day, (415) 20-day, (426) 50-day, (438) 100-day, (443) 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 518 (+9), with a high of 520, low of 508. December Wheat (ZWZ25) settled at 539 (+0.75). Chicago Wheat has a cash price of 478 (-0.25). September KC Wheat (KEU25) settled at 521 (+10).
Wheat finally saw some buying today after several weak sessions. Prior to today, wheat was lower for 13 straight sessions. Ending stocks are estimated lower for the August WASDE. Analysts are predicting ending stocks at 882 mb, compared to 890 mb in July. All wheat production is estimated at 1.922 bb versus 1.929 last month. HRW, SRW, and winter wheat are all expected near unchanged from the last month. President Trump is supposed to meet with Putin to discuss an end to the war in Ukraine. It seems unlikely, in my opinion, that any resolution will be made between the two parties. Putin has been difficult to negotiate with. A ceasefire or an end to the war would likely come with a drop in wheat prices.
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 – (513) 5-day, (532) 20-day, (545) 50-day, (553) 100-day, (574) 200-day
ZWZ25 Moving Averages – (534) 5-day, (552) 20-day, (566) 50-day, (575) 100-day, (594) 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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