Steady to higher start in grains following overnight gains
A steady to mostly higher start is expected this am following overnight gains in some pits, especially beans. The early call is 2-3 up in wheat, steady/better corn and 10-15 higher beans. The outside markets are modestly negative for the grains this am with crude oil and equities lower while the $ is only slightly lower.
The Weekly Crop Ratings yesterday afternoon were unchanged for beans, 67% good to excellent. Corn was 70% vs 71% while spring wheat was 74% vs 73% previously. Traders had expected a decline of 1-2% in the condition of these crops, which is the usual seasonal tendency at this time of year. The fact they only fell 1% in the case of corn and were steady to better in the case of beans and spring wheat is a sligthly negative background influence for the market this am. Crop development remains well behind normal: beans blooming reached 63% vs 76% average; beans setting pods were just 20% vs 36% average; corn silking was 55% vs 76% average; corn in the dough stage of development is only 7% vs 17% average; spring wheat headed is 93% vs 98% usually by this time in the season. Winter wheat harvesting is now 79% complete vs 84% average.
The Commodity Futures Trading Commission (CFTC), which regulates all futures trading in the US, will hold hearings today, tomorrow and Aug 5 on position limits and exemptions to these limits. These hearings will be chiefly concerned with the energy markets, such as crude oil. Agricultural markets position limits are set by the CFTC but in some of the other markets, such as energy, positions limits are determined by the exchanges. Many blame excessive speculation for the huge run up in energy prices last year and the CFTC wants to address this so-called problem. Notice that while speculators are blamed for the huge run up in energy prices last year, no one thanks speculators for the just as big sell off in energy prices this year! It certainly is true that massive long liquidation by speculators was one of the major reasons for the big sell-off in energy prices seen this year. These hearings will not affect the grain markets directly but grain traders will still watch them.
The Argentine government has invited the four major farmers unions to a meeting Friday to discuss possible farm policy changes, including the sky high 35% export tax on beans that farmers detest.
No significant Argentine rain is predicted for the next 7 days or longer, once again increasing stress on their wheat crop. Generally favorable weather continues in the main Chinese grain areas although it will be warmer and drier in the north the next 7 days, according to this morning's forecast.
The US delta will continue enjoying very good conditions the next several days or longer with mild temps and scattered rain. The Midwest also will benefit from good weather with scattered rain and cool temps persisting. However, more rain would be welcome in parts of the northwest as well as the northern part of the far eastern half of the belt.
Traders will be keeping an eye on the $9 level in Nov beans today since this level held yesterday and prices rallied sharply after the bears failed to break below it. ---Vic Lespinasse
The Weekly Crop Ratings yesterday afternoon were unchanged for beans, 67% good to excellent. Corn was 70% vs 71% while spring wheat was 74% vs 73% previously. Traders had expected a decline of 1-2% in the condition of these crops, which is the usual seasonal tendency at this time of year. The fact they only fell 1% in the case of corn and were steady to better in the case of beans and spring wheat is a sligthly negative background influence for the market this am. Crop development remains well behind normal: beans blooming reached 63% vs 76% average; beans setting pods were just 20% vs 36% average; corn silking was 55% vs 76% average; corn in the dough stage of development is only 7% vs 17% average; spring wheat headed is 93% vs 98% usually by this time in the season. Winter wheat harvesting is now 79% complete vs 84% average.
The Commodity Futures Trading Commission (CFTC), which regulates all futures trading in the US, will hold hearings today, tomorrow and Aug 5 on position limits and exemptions to these limits. These hearings will be chiefly concerned with the energy markets, such as crude oil. Agricultural markets position limits are set by the CFTC but in some of the other markets, such as energy, positions limits are determined by the exchanges. Many blame excessive speculation for the huge run up in energy prices last year and the CFTC wants to address this so-called problem. Notice that while speculators are blamed for the huge run up in energy prices last year, no one thanks speculators for the just as big sell off in energy prices this year! It certainly is true that massive long liquidation by speculators was one of the major reasons for the big sell-off in energy prices seen this year. These hearings will not affect the grain markets directly but grain traders will still watch them.
The Argentine government has invited the four major farmers unions to a meeting Friday to discuss possible farm policy changes, including the sky high 35% export tax on beans that farmers detest.
No significant Argentine rain is predicted for the next 7 days or longer, once again increasing stress on their wheat crop. Generally favorable weather continues in the main Chinese grain areas although it will be warmer and drier in the north the next 7 days, according to this morning's forecast.
The US delta will continue enjoying very good conditions the next several days or longer with mild temps and scattered rain. The Midwest also will benefit from good weather with scattered rain and cool temps persisting. However, more rain would be welcome in parts of the northwest as well as the northern part of the far eastern half of the belt.
Traders will be keeping an eye on the $9 level in Nov beans today since this level held yesterday and prices rallied sharply after the bears failed to break below it. ---Vic Lespinasse
posted by InsightPublishing at
10:30 AM
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