Grains appears set for Turn-Around Tuesday
A higher start is expected this am, 5 in wheat, 3 in corn and 7-10 in beans following overnight gains. The market appears set to follow the "turn-a-round Tuesday" pattern with sharply lower prices on Monday followed by an upside reaction today. The two main catalysts for this expected recovery are the weekly crop ratings, which unexpectedly fell from last week despite seemingly ideal weather; and the supportive outside markets. Crude oil is slightly higher this am while the $ is slightly lower, both in sharp contrast to yesterday at this time when these outside markets were sending strong sell signals to the grains.
Corn's good to excellent rating fell to 71% from 72% last week. Beans declined from 68% last week to 66% this week while spring wheat dropped from 76% to 72%. All these ratings had been expected to be unchanged to 1-2% better so the fact they declined was a bullish surprise for the market. Crop development remains well behind normal due to their late planting this spring: Corn silking is only 8% vs 16% average while beans blooming reached only 14% vs 24% average. Spring wheat heading is only 30% done vs 65% average. Winter wheat harvesting is almost caught up at 56% vs 59% average.
4300 wheat was put out on delivery along with 3000 oil.
The USDA attache in New Delhi, India said rain is needed by mid-July for various crops or India could be headed for a severe drought. The monsoon is now expected to bring much needed rain to India's bean belt over the next 3-5 days. Reports from Australian weather forecasters indicate El Nino is thought to be behind the poor monsoon season so far in India. Pacific Ocean conditions that are thought to cause El Nino moderated in June. This offers hope El Nino might not be as intense this season as feared, allowing crops in countries around the world to escape severe weather conditions. Beneficial rain is predicted in the North China Plain the next 1-3 days, along with cooler temps, which will also be beneficial for crops there. Russian spring wheat regions continue to suffer from very dry weather with little relief in sight.
The US Midwest will see scattered rain the rest of this week into the weekend, keeping conditions favorable for corn and beans. The 6-10 day calls for above normal rain, which will also be welcome. Generally favorable harvest weather is forecast in the southwest winter wheat belt the next several days or longer. ---Vic Lespinasse
Corn's good to excellent rating fell to 71% from 72% last week. Beans declined from 68% last week to 66% this week while spring wheat dropped from 76% to 72%. All these ratings had been expected to be unchanged to 1-2% better so the fact they declined was a bullish surprise for the market. Crop development remains well behind normal due to their late planting this spring: Corn silking is only 8% vs 16% average while beans blooming reached only 14% vs 24% average. Spring wheat heading is only 30% done vs 65% average. Winter wheat harvesting is almost caught up at 56% vs 59% average.
4300 wheat was put out on delivery along with 3000 oil.
The USDA attache in New Delhi, India said rain is needed by mid-July for various crops or India could be headed for a severe drought. The monsoon is now expected to bring much needed rain to India's bean belt over the next 3-5 days. Reports from Australian weather forecasters indicate El Nino is thought to be behind the poor monsoon season so far in India. Pacific Ocean conditions that are thought to cause El Nino moderated in June. This offers hope El Nino might not be as intense this season as feared, allowing crops in countries around the world to escape severe weather conditions. Beneficial rain is predicted in the North China Plain the next 1-3 days, along with cooler temps, which will also be beneficial for crops there. Russian spring wheat regions continue to suffer from very dry weather with little relief in sight.
The US Midwest will see scattered rain the rest of this week into the weekend, keeping conditions favorable for corn and beans. The 6-10 day calls for above normal rain, which will also be welcome. Generally favorable harvest weather is forecast in the southwest winter wheat belt the next several days or longer. ---Vic Lespinasse
posted by InsightPublishing at
10:30 AM
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