USDA ESTIMATES & MARKET UPDATE
Futures Prices 8:30 am CT
Overview
Grains higher to start of the morning as all eyes are on the USDA report at 11 am CT. Grains seeing strength as at one point the dollar was down 60 points in the overnight session, however the dollar has picked up steam trading higher this morning. Grains will likely trade the report instead of the outside markets after the release, but ultimately no matter where the report comes in at, the outside markets will likely continue to dictate the direction of grain. With all the hype surrounding the report, we have to keep in mind that there is a chance the report comes in as a dud, and with the small changes we’ve seen in prices the past few days it's hard to say.
USDA Estimates
September 1 U.S. Grain Ending Stocks (Million Bushels)
Corn
Average Estimate - 1,512
USDA June 1, 2022 - 4,346
USDA Sep. 1, 2021 - 1,235
Soybeans
Average Estimate - 242
USDA June 1, 2022 - 971
USDA Sep. 1, 2021 - 257
Wheat
Average Estimate - 1,776
USDA June 1, 2022 - 660
USDA Sep. 1, 2021 - 1,774
2021/22 Revised U.S. Production (Million Bushels)
Corn Production
Average Estimate - 15,091
USDA Previous - 15,115
Soybean Production
Average Estimate - 4,437
USDA Previous - 4,435
2022/23 U.S. Wheat Production (Million Bushels)
All Wheat
Average Estimate - 1,778
USDA Previous - 1,783
All Winter
Average Estimate - 1,191
USDA Previous - 1,198
Hard Red Winter
Average Estimate - 573
USDA Previous - 576
Soft Red Winter
Average Estimate - 379
USDA Previous - 381
White Winter
Average Estimate - 238
USDA Previous - 240
Other Spring
Average Estimate - 514
USDA Previous - 512
Durum
Average Estimate - 74
USDA Previous - 74
Today's Main Takeaways
Corn
Everyone is looking forward to the Quarterly Stocks Report this morning. One of the biggest things people are keeping an eye on will be where we see last year's production come in at. There is a lot of rumors that we see this old crop number come in below expectations, which would be a bullish surprise. However, one could argue that demand is still too poor even if last year's numbers come in lower.
Demand as has been the story for the past few weeks, remains fairly weak. Last weeks export sales were better than the previous week, but still very poor, at about half of last years pace.
Nonetheless, wherever numbers come in at, we can expect some volatile trade after the report as usual. The USDA report will likely set the tone for the rest of the week.
U.S. weather is looking pretty good for the next few weeks. Most are expecting harvest to start moving along at a faster pace given this window of cooperative weather. South America has also begun planting, and we won't likely see any major weather headlines out of there until later in the year when it matters a lot more.
Dec-22 (6 Month)
Soybeans
Soybeans 6 1/2 cents higher this morning. Similar to corn, all eyes are on the USDA report this morning. However there are some other headlines in the soybean market that may get as much attention as the USDA report. That being the political tensions in Brazil. This will likely be a bigger story going into next week.
We are looking for a 242 million ending stocks, down 15 million from last year. Which is the number everyone will be watching.
Of course the outside markets have continued to keep a lid on grain prices, with the dollar continuously surging to new highs. But other than outside markets, demand just isn't there yet. We did see weekly exports come in a little better than previously. But Chinese demand for U.S. exports remains lackluster, to go along with the recent tensions and their lockdown situation. Ultimately if we want higher prices we will almost certainly need to see an increase in demand.
Soymeal & Soyoil
Soymeal up +2.9
Soyoil down -0.08
Soybeans Nov-22 (6 Month)
Wheat
Wheat higher this morning, making up for most of yesterdays losses. As for the report we are looking at for the Sep. 1 stocks to come in right about where they were last year.
Weekly exports came in disappointing again. The strength of the U.S. dollar has also been continuing to put pressure on the markets.
The Russia and Ukraine war headlines have been bullish for the wheat markets, and one could argue that they will continue to do so. But ultimately, the entire situation remains a wild card as nobody knows what Putin will do next.
There is a rumor that former President Trump is looking to land a peace deal between Ukraine and Russia.
Chicago Dec-22 (6 month)
KC Dec-22 (6 month)
MPLS Dec-22 (6 month)
Other Markets
Crude oil down -0.38 to 80.85
Dow Jones down -20 (-0.05)
Dollar Index up +0.485 (+0.43%)
Cotton up +0.19 to 85.35
News
Trump is looking to carve out a peace deal between Ukraine and Russia
The second quarter GDP came in at -0.6% which further confirms we are technically in a recession according to historical data.
Inflation rate in Europe hit 10%
Hurricane Ian is looking to make landfall again, this time in South Carolina.
This Week's Weekly Newsletter - Read Here
Social Media
Credit: All credit to users of posts
Weather
Source: National Weather Service