6.21.24

 

 

Good afternoon. Ag markets took a beating on Thursday as traders returned from the one-day holiday break and continued hitting the sell buttons. The current weather forecast seems to not be threatening enough to make fund traders anxious, which has allowed prices to decline back near their Spring lows. New crop soybeans made new lows for the year today, while new crop corn is back within a dime of its Spring lows. For now, traders see a record, or near record, crop as likely in 2024.

 

CN closed at 4.39 3/4, down 10 1/4. CZ closed at 4.56 3/4, down 11. SN closed at 11.55 1/4, down 18 3/4. SX was down 15 1/4 at 11.16 3/4. New low is 11.15. WN closed at 5.72 3/4, down 9 1/4. Products were lower, July bean meal closed at 357.60, down $7/ton, and July bean oil closed at 43.97, down 33 points. Meal had an outside day lower. Livestock markets were mixed, August live cattle closed at 182.55, up 45 cents, August feeders closed at 259.82, down 5 cents, and July hogs closed at 91.15, down $2.62. Hogs gapped lower on this morning's open, and cattle had outside lower days. Outside markets are higher, crude oil futures are up 60-80 cents/bbl, the Dow Jones index is up 300 points, and the US$ index is up 40 points. Crude oil futures today traded to their highest level since April 30th. The NASDAQ and the S&P both had outside days lower.

 

Spreads closed mixed on Thursday, corn spreads were down a penny and a quarter to up 3/4 of a cent, and soybean spreads were down 3/4 of a cent to down 5 cents. CN/CU closed at -5, up 3/4, and SN/SU closed at 42, down 2 1/4. Old/new crop bean spreads again made new highs today before closing lower. WN/WU also made new highs today, and closed at -13 1/4.

 

This morning's weekly ethanol production report, delayed a day because of the Wednesday holiday, showed that daily production for the week ending June 14th totaled 1.057 mil bbls. This was up 3.3% from last week, and up 0.5% from the same week last year. Stocks were seen at 23.617 mil bbls, which was again a new record for this week in the year; the figure was up 1.7% from last week, and up 3.6% from the same week last year. Corn used for ethanol was estimated at 105.3 mil bu's, up from last week's 101.9 mil. Cumulative use has reached 4.214 bil bu's, vs the USDA's marketing year forecast of 5.450 bil bu's.

 

The EIA report also showed US crude oil stocks down 2.5 mil bbls on the week, which was almost right on trade expectations. Gasoline stocks were down 2.3 mil bbls, vs expectations for a 1.5 mil bbl increase. Implied gasoline demand was seen at 9.386 mil bpd, which is up from 9.040 mil last week, and 9.375 mil last year.

 

Also out on the weekly data slate today was the most recent drought monitor update, showing recent dry conditions are beginning to have an effect in the Eastern Corn Belt. Though not an official drought category, the amount of land in D0 drought condition, which is classified as abnormally dry, increased from 5.8% to 22.4% in the past week, with most of this increase coming in IA, IL, IN, and OH. While not overly concerning as it stands today, a lack of moisture in the forecast for these areas bears monitoring going forward. As a nation, still just 3% of the corn growing area is in D1-D4 drought condition, while just 2% of the soybean area is in these conditions.

 

Financial markets continue to chop, as the trade debates the likelihood of coming interest rate cuts. This morning's weekly jobless claims came in 5,000 lower than last week at 238,000 for the week ended June 15th, compared with expectations for 235,000 claims. The data reverses about a third of last week's jump to fresh ten-month highs. Continuing claims were up 15,000 to 1.828 million, which was the highest reading since January.

 

NOAA released its new 30-day forecast for the month of July, which shows the possibility for hot/dry weather across much of the Corn Belt. Worth noting that their 30-day outlook for June called for average temps and average to above average precip in the Eastern Corn Belt. Otherwise, the mid-day forecast continues to offer the same general pattern that has been seen in recent days. Storms continue to bring rainfall to the Northwestern edge of the Eastern US ridge, with an additional 2-4" of precip forecast for NE/SD/MN/WI through this weekend. The rest of the Corn Belt remains mostly dry. Temps through the Midwest will be hot into the middle of next week, before models see a low pressure trough bringing cooler air to the Northern Midwest in the next 10 days. Nighttime lows dip back into the upper 60's next week for most of the Corn Belt.

 

Areas of Eastern Mexico have received upwards of 12" of rain in some places over the last 24 hours, with a more general 0.5-2" realized from Tropical Storm Alberto. Additional moisture is seen favoring the Eastern half of the country over the next week. The rest of the international forecast is unchanged at mid-day as prevailing themes remain.

 

 

 

 

 

 

 


Quotes are delayed, as of June 23, 2024, 12:51:28 AM CDT or prior.

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