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Corn Outlook:
The bears are out in force as non-threatening weather is forecast through the first week of July. This is evident from the funds increasing their shorts in corn 55 MB last week to 1.370 BB, their largest position since July 2024. Last week, the crop rating for corn fell 2-points to 70 percent in good-to-excellent condition but is one-point above a year ago. According to Ag Watch’s yield model, this equates to a national yield of 179.3 bpa compared to USDA’s estimate of 181.0 bpa. Meanwhile, AgroConsult has raised Brazil’s safrinha crop estimate to 123.3 million tons from 112.9 million in May. Looking at exports, inspections were 58.1 MB and above the average of 54.1 MB that is needed to meet USDA’s target of 2.650 BB. However, the pace has dropped off. The bottom line is that without weather being a factor, there is little incentive for the funds to cover their shorts.
Bean Outlook
EPA’s proposal to increase the blend in the biofuel mandate appears to have been factored into values for soy oil and soybeans as they have tumbled. Furthermore, China and Brazil working on a supply chain model designed to meet China’s import standards is also weighing on values. Meanwhile, the weather is currently a nonfactor. Last week, the rating for soybeans stood unchanged at 66 but was one-point above a year ago. According to Ag Watch’s yield model, this equates to a national yield of 50.7 bpa compared to USDA’s estimate of 52.5 bpa. Looking at exports, there is no red flag waving at the bulls as inspections last week were a marketing year low of 7.0 MB with China being a no show for the third straight week. The bottom line in soybeans is that weather could still be a consideration, but there are no threats currently on the horizon.
Wheat Outlook:
The wheat harvest is progressing at a snail’s pace as producers have been dealing with wet conditions. Last week, only 19 percent of the crop had been harvested compared to 38 percent a year ago and the average of 28 percent. Looking at exports, they backed off last week with inspections of 9.3 MB, the lowest for the season. This may be because of slight upward revision in Russia’s production. Currently, the most supportive factor for wheat is that the funds are short 405 MB and may cover as harvest nears an end.
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