Soybeans–
Soybeans sold off on Thursday, with some profit taking place after a rally earlier in the week. The US has a price advantage over Brazil do to a weaker dollar, but China keeps buying from South America. CONAB estimated Brazil’s production at 169.65 mt, below the previous estimate at 170.5. Argentina’s crop was estimated at 50.2 mt, up 2%. Canada has started their own little trade war with China. China set import tariffs on Canadian canola in response to Canada’s EV tariffs. Canada is now offering canola at a less than 1/3 of the price of other Asian countries.
September Soybeans (ZSU25) settled at 1007 (-16), high of 1029, low of 1007. New crop November Soybeans (ZSX25) settled at 1028 (-15), high of 1097, low of 1027. Cash price is at 1019 (+12)
September Bean Meal (ZMU25) settled at 284.3 (-2.7) high of 289.8, low of 283.9
September Bean Oil (ZLN25) settled at 51.99 (-1.40) high of 53.50, low of 51.83
The September Meal to Oil ratio (52.24% Meal – 47.76% Oil)
ZSU25 Moving Averages – (1000) 5-day, (992) 20-day, (1010) 50-day, (1016) 100-day, (1020) 200-day
ZSX25 Moving Averages – (1020) 5-day, (1010) 20-day, (1023) 50-day, (1025) 100-day, (1025) 200-day
ZMU25 Moving Averages – (282) 5-day, (275.2) 20-day, (281.7) 50-day, (291.7) 100-day, (302.5) 200-day
ZLU25 Moving Averages – (52.90) 5-day, (54.76) 20-day, (53.32) 50-day, (50.64) 100-day, (47.33) 200-day
The Commitments of Traders report for the week ending August 5 showed soybean Managed Money traders sold -29,619 contracts to their bringing their net short to -65,930 contracts. Producer/Merchants bought 19,529 contracts bringing their net short position to -68,230 contracts. Non-Commercial & Non-Reportable traders net position was -66,976 contracts.
The Commitments of Traders report for the week ending August 5 showed meal Managed Money traders sold -234 contracts, moving to a net short position of -133,592 contracts. Producer/Merchants sold -6,902 contracts bringing their net short position to -29,192. Meal Non-Commercial & Non-Reportable traders hold a short position of -82,931 contracts.
The Commitments of Traders report for the week ending August 5 showed bean oil Managed Money traders were net long 54,939 contracts after selling -11,661 contracts. Non-Commercial & Non-Reportable traders net long position was 78,565 contracts.
CORN –
September Corn (ZCU25) settled at 375 (+1), high of 376, low of 369. New crop December Corn (ZCZ25) settled at 398.5 (+1.25). Cash price is 385 (-5)
Corn showed some strength today, closing positive, after the bearish WASDE report earlier in the week. The corn crop could get bigger from here. But my thinking is that we could be at the peak supply fear stage right now, with the USDA raising yield to 188.8 bpa. Then later on the USDA may decide to lower yield, which would give us a reason to see higher prices. Places like Iowa and Nebraska have great crops, but there are some eastern states out there with wet areas that could drop the yield later in the year. The Pro Farmer crop tour starts Monday. It will be interesting to see what the tour finds and if yields match up with the USDA’s forecast.
ZCU25 Moving Averages – (377) 5-day, (389) 20-day, (404) 50-day, (421) 100-day, (434) 200-day
ZCZ25 Moving Averages – (400) 5-day, (410) 20-day, (422) 50-day, (435) 100-day, (442) 200-day
The Commitments of Traders report for the week ending August 5 showed that corn Managed Money bought 7,435 contracts bringing their net position to -173,750 contracts. Producer/Merchants sold -2,417 contracts bringing their net position to -27,359. Non-Commercial & Non-Reportable traders net short position was -198,038 contracts.
WHEAT –
September Chicago Wheat (ZWU25) settled at 503 (-3), with a high of 508, low of 500. December Wheat (ZWZ25) settled at 524 (-3). Chicago Wheat has a cash price of 476 (+2). September KC Wheat (KEU25) settled at 504 (-2).
Chicago and KC wheat were weaker in the overnight, by 4 1/4 and 6 cents, respectively. Wheat traded modestly lower again during today’s session. The meeting between Putin and President Trump will take place in Alaska tomorrow. The meeting in Alaska could have a sizeable impact on wheat prices going forward if anything new is announced. The US still has burdensome ending stocks. Exports are needed to reduce supply. The US has a price advantage due to a weaker dollar. Germany’s wheat crop is estimated at 22.4 mt, up from 21.6 in July. Argentina has favorable conditions for wheat development, while Brazil’s production estimate sits unchanged at 7.81 mt. Overall sentiment for the weak market continues to remain bearish. If no concessions are made by Russia, maybe wheat can see a bounce.
ZWU25 Moving Averages – (509) 5-day, (524) 20-day, (541) 50-day, (549) 100-day, (571) 200-day
ZWZ25 Moving Averages – (529) 5-day, (544) 20-day, (562) 50-day, (571) 100-day, (591) 200-day
The Commitments of Traders report for the week ending August 5 showed that Managed Money traders in the wheat market were net short -80,769 contracts, having increased their short position by -15,445 contracts. Producer/Merchants bought 8,644 contracts to bring their net long position to 16,310 contracts. Non-Commercial & Non-Reportable traders were net short -84,046 contracts.
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