Wheat harvest rolls on while dryness creeps in the Eastern Cornbelt | Weekly Commodity Market Update

Brownfield Ag News

This week Will and Ben jump into wheat harvest and take a look at growing dryness in parts of the Cornbelt.

Market recap (changes on week as of Monday's close):

» July 2024 corn down $.08 at $4.43

» December 2024 corn down $.05 at $4.63

» July 2024 soybeans down $.31 at $11.57

» November 2024 soybeans down $.28 at $11.30

» July soybean oil up 1.11 cents at 43.73 cents/lb

» July soybean meal down $7.70 at $360.30/short ton

» July 2024 wheat down $.16 at $5.91

» July WTI Crude Oil up $2.61 at $80.52/barrel

Weekly highlights:

US consumer sentiment unexpectedly fell in May to 65.6 down from 69.1 according to the University of Michigan last week. This was the third consecutive month of lower than expected consumer sentiment.

The June consumer price index numbers came in below expectations across the board. The headline CPI was flat month on month and was better than the 0.1% grow expected. The CPI was up 3.3% year over year but also down from the 3.4% expected by analysts.

The headline producer price index dropped to 0.2% month on month in May compared to 0.5% month on month in April. The annual change of 2.2% in May matched April but was lower than analyst expectations of 2.4%.

The Federal Reserve held interest rates steady in June as expected. They also indicated only one interest rate cut in 2024, down from three estimate this year in March.

USDA’s monthly WASDE report contained few surprises as is expected in June. USDA did cut 6.5 million metric tons out of the combined Ukraine and Russian Wheat crop bringing the combined production to 83 mmt. USDA cut 1 million metric tons from Brazilian soybean crop.

US energy stocks were higher for the first week of June. Crude oil stocks were up 156.6 million gallons, gasoline stocks were up 107.7 million gallons, and distillate stocks were up 37 million gallons.

US ethanol production decreased for the first time in over a month. US ethanol production came in at 301 million gallons down from 315 the week prior. Ethanol stocks increased just slightly by 7 million gallons but remain 4% higher than the same week last year.

The National Oilseed Processors Association reported their members crushed 183.5 million bushels of soybeans in May. The volume was within expectations but up from the 178.4-million-bushel average, the 169.4 million bushels in April and set a new monthly May record up from the 177.9 million bushels last May.

Open interest positions of Chicago futures and options positions were up for soybean meal (+0.9%) while down for combined Chicago wheats (-6.0%), corn (-0.5%), soybean (-1.7%), soybean oil (-0.1%), cotton (-11%), and rice (-0.1%).

Managed money traders were net sellers of soybeans and Chicago wheat futures and options contracts while largely neutral on corn contracts. Traders sold a net 16,302 contracts of Chicago wheats and 16,139 contracts of soybeans. Traders had a net purchase of 427 contracts of Chicago corn to slightly reduce their relatively large net shorts. The net short positions grew 141,000 positions over the prior 3 weeks.

Weekly grain and oilseed export sales were mixed for the week ending June 6th. All commodities had weekly export sales that exceeded the 10 week rolling average. Wheat sales of 8.2 million bushels exceeded all pre-report expectations. Export sales of new crop corn and soybeans were minor.

Last week’s grain and oilseed export inspections were within expectations but supportive. Corn export inspections of 50.7 million bushels are seasonally strong as Mexico continues to buy and accept delivery of US corn.

The US corn conditions rating fell just slightly on the week to 381 compared to 384 last week and 348 last year and slightly lower than expectations.

US soybean conditions also declined a little more than expected but still remain in good shape at 376 compared to 379 last week and 346 last year.

Twenty-seven percent of the winter wheat crop is harvested up from 13% last year. The winter wheat conditions score increased to 335 up from 330 and compares to 304 last year at this time.

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