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The grains are being bombarded from several different fronts. Most recently has been the military exercise by China in Taiwan’s backyard. This could cause repercussions in their economy, as well as the U.S. Also, grain is starting to be shipped from Ukrainian ports, and signs of a recession are a concern. Meanwhile, weather is still a factor. Last week, the rating for corn fell 3-points to 58 percent of the crop in good-to-excellent condition which was more than expected and sparked a mid-week rally. According to Ag Watch’s yield model, the national yield is 170.0 bpa. At the end of the week, the USDA will give their assessment of supply in the crop report. Once weather passes as a factor, demand will be the focus. Right now, there is room for improvement. Last week, export inspections were only 21.8 MB, their lowest since October. Unless the pace picks up over the next few weeks, shipments are on track for 2.2 BB.
For the next couple of weeks, weather will remain the focus in soybeans. Last week, the rating fell one-point to 59 percent of the crop in good-to-excellent condition which was in line with expectations, but is below the 10-year average of 61 percent. According to Ag Watch’s yield model, the national yield is 51.5 bpa. The USDA will give their assessment in the crop report late this week. Once concerns of weather have passed, demand will be the focus. It picked up last week with export inspections of 31.8 MB, their highest since April. Also, shipments to China were their highest since April at 9.1 MB. Right now, we should keep an eye on Brazil and China, as their relationship is improving while China’s association with the U.S. is deteriorating because of Taiwan.
At times, wheat shows signs of life. However, for the most part, it is content to sit on the bench watching the action in corn and soybeans. That may continue a while longer until there are new developments. Meanwhile, winter wheat harvest is winding down at 86 percent complete, while cutting of spring wheat is just getting underway at 9 percent done. In other matters, exports were stellar last week at 22.1 MB, a marketing year high. With a strong dollar and Russia, a staunch competitor, we need to see exports pick up.
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