Commentary
The much-anticipated Pro Farmer crop tour continued through Nebraska, Indiana, and Illinois today. Day two of the Pro Farmer Crop Tour appears to be finding more variability in Nebraska (western leg) and Indiana into Illinois (eastern leg) than solid findings yesterday. In my opinion that was expected as the tour moves along. Soybean conditions held steady at 59% this week. It was a tug of war by material moves in individual states with the Dakotas down 3, Kansas down 6, Minnesota up 6, MO up 6, ILL down 5, and Michigan up 10. 96% of the crop has hit the blooming stage vs 96 average. 86% of the crop is setting pods vs 84% average. Currently the US soybean crop is rated 2% G/E better than last year. The US logged a 49.5 yield with a crop that finished at 57%. The USDA put forward a yield 10 days ago that was 50.9 and today’s rating is 59%. Those ratings are very subjective given this is key yield development for beans. Multiple forecasts are calling for the heat to move out of the Midwest this weekend, but it looks to stay dry in the Midwest going into month end and Labor Day weekend. Should the dryness continue and verify, look for funds to add to their net long if dry conditions persist in the Midwest. Managed funds are projected to be long about 60K contracts, while short Corn 83K and 71K of Chicago wheat. Technical levels come in as follows for the remainder of the week. Support is first at 1338. A close under and its 1316. A close below 1316 and we could see the market challenge the 200-week moving average at 1283. Resistance is at the downward trendline at 1383. We filled the gap Sunday night at 1380 already. A close above this trendline is needed to send the market higher. should that happen in my view, look for the market to challenge 1426, (50-week MA), and then 1446 the (100-week MA).
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