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July tends to be a bit rowdy for the grains, and this month is no exception as corn is seeing daily price swings of 27-60 cents. This will continue as long as weather remains a factor. Showers forecast in the dry sections of the upper Midwest for the next 5-10 days was the factor behind prices tumbling after the July 4th holiday. Last week, the crop rating stood unchanged at 64 percent in good-to-excellent condition and compares to 71 percent a year ago and 67 percent for the 10-year average. According to Ag Watch’s yield model, this equates to a national yield of 167.0 bpa versus 172.0 bpa last year. Looking at exports, they are beginning to show signs of weakness. Inspections last week were 48.6 MB and are a far cry from the levels seen since May-June. Since mid-May, the pace of shipments has fallen 31 percent. While China remains the largest buyer of our corn, taking 33 percent of last week’s shipments, the pace to them has declined for two weeks.
Like corn, soybeans are seeing some sharp price swings that have ranged between 76-cents to $1.12. While July is a critical month for soybeans, August is a more crucial period. Last week, the crop rating slipped one-point to 59 percent in good-to-excellent condition and compares to 71 percent last year and the 10-year average of 64 percent. According to Ag Watch’s yield model, the national yield is 47.3 bpa versus 50.2 bpa a year ago. Looking at exports, inspections last week were 7.5 MB, the highest seen since early June. While weather will continue to reign as the dominant factor in soybeans for the next several weeks, exports must improve for the market to have solid footing.
Wheat is mostly a follower of corn and soybeans, but recent showers in the upper Plains could stabilize the spring crop. However, the damage from the drought has taken its toll and conditions are unlikely to be reversed. Last week, the rating for the spring crop fell 4-points to 16 percent in good-to-excellent condition, which is far below the rating of 70 percent a year ago and the 10-year average of 68 percent. Winter wheat harvest is progressing slowly at 45 percent complete compared to 53 percent last year. In other developments, export inspections last week were a marketing year low of 9.4 MB and must average 17.7 MB each week to reach USDA’s target of 900 MB.
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