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The focus in the grains this week is on the Pro Farmer crop tour, and whether their findings measure up to the USDA’s yield estimate in the August Report. So far, they have. Meanwhile, the rating for corn slipped 2-points last week to 62 percent of the crop in good-to-excellent condition. Last year’s rating was 69 percent. According to Ag Watch’s yield model, the national yield is 167.0 bpa versus USDA’s estimate of 174.6 bpa and 172.0 bpa a year ago. While supply remains the primary emphasis, concerns are mounting regarding the rise in Covid rates, and geopolitical uncertainty arising from the downfall of the government in Afghanistan. The later raises questions on many fronts, namely our relations with China, Russia, and allies in the Middle East. Last week, export inspections were nominal at 29.7 MB. Currently, demand is forecast to be down 360 MB from a year ago and must improve to maintain present day prices.
While improving rain chances and cooler temperatures later this month could give the soybean crop a boost, it may be too little too late for some areas. This is evident from the crop rating falling 3-points last week to 57 percent in good-to-excellent condition. Last year’s rating was 72 percent. According to Ag Watch’s yield model, this translates to a national yield of 46.8 bpa compared to USDA’s forecast of 50.0 bpa and 50.2 bpa a year ago. In other developments, recent purchases by China have given exports a lift, but their overall purchases were revised downward by 1.0 million tons in the August Report. Meanwhile, inspections last week at 10.2 MB were the highest seen since mid-May. In the meantime, the focus in soybeans remains on the findings in the Pro Farmer crop tour, the rising Covid rates, and increasing geopolitical uncertainties.
Wheat struggled this week from overbought conditions even though the production prospects for Canada and Russia are declining. Eventually, this could lead to an increase in U.S. exports. Meanwhile, inspections last week were 16.1 MB which is below the average of 16.9 MB that must be shipped on a weekly basis to achieve USDA’s target of 875 MB. In other developments, spring wheat harvest is running at 58 percent complete versus the average of 38 percent. This is because of lower yields from the intense heat and lack of rain earlier in the season.
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