Soft Monday, everyone was looking at the sky rather than at the screen. Soybeans ended down -5 cents, Corn -3 cents and Wheat markets were all over the place: -6.50 cents in Chicago, -6.75 cents in Kansas, -13.75 cents in Minneapolis, -€3.50 in MATIF, -€3.00 in CME EU and -£0.80 in LIFFE. The GASC new episode of shambles over poppy seeds is not helping European Union markets. There is some scepticism about the story (a diverted way to keep aside EU wheat?) and it reinforce the feeling that execution is difficult and it is feared that French wheat will struggle once again to make its way to Egypt during the season, so new long term destination need to be found. On top of that, the Russian cash market will influence a lot international prices and it keeps going down (3 weeks in a row). In Chicago, funds sold 7,000 Corn, 4,000 Wheat and 1,000 Soybeans to start the week.

At some point, market will post a decent technical rebound for sure as it feels we’re close to exhaustion and there is still quality issues around and uncertainty (and speculation) about US yields. Night session is on the upside (sounds familiar so far) gently rebounding +3 cents on Soybeans, +1 cent on Corn and +2 cents-ish on Wheat markets. MATIF is rebounding on the open with +€1.25 cent, CME EU is flat and London Feed is down -£0.80 as harvests are finding a couple of day opportunity on the weather side.

FC Stone said that the September USDA WASDE report will either reinforce the bearish sentiment or revers it with significant market implication. Basically, we have no clue! Well, one thing is sure, it’s expected to be a market mover, even on the downside as there is still a level of scepticism integrated in Corn and Soybeans prices. But before the report (12th of September) we have the Pro Farmer Tour 2017: it kicked off yesterday indeed. Now rebranded as Farm Journal (so it is the Farm Journal Midwest Crop Tour 2017, main hashtag to follow on Twitter is #FJTour17), it will for sure give us an idea about the reliability of the current WASDE yields (169.5 bushels per acres for corn and 49.4 bushels per acre for soybeans). So after day 1:


  • Corn Ohio: yield 164.62, last year 148.96, 3 year average 159.81, USDA 171.
  • Corn South Dakota: 147.97, last year 149.78, 3 year average 156.14, USDA 140.
  • Soybean Ohio: 3×3 Pods Count 1,107.01, last year, 1,055.05, 3 year average 1,174.24.
  • Soybean South Dakota: 3×3 Pods Count 899.56, last year 970.61, 3 year average 1,027.80

It’s going to screw everyone magic big data spreadsheet and raise the expectations and the potential disappointment on the next WASDE. Indeed, their Ohio yield is 10.51% above last year (but they had underestimated the yield by 6.74% last year), on a state that is producing 3.90% of the US corn, it doesn’t really help the data analysis! On top of that, South Dakota (4.75% of the production) discrepancy with USDA is pretty big. It really makes this first day tough to analyse on corn and so far, my model is 169.26/171.95 (current WASDE is at 169.5. Last year they ended up with 170.2 for the US yield, USDA actual was 174.6.

On Soybeans it’s even tougher, their pod counts are raising 4.92% compared to last year on a 6.04% producing state (Ohio) and decreasing by -7.32% on a 5.02% producing state (South Dakota) so this is a tough guess as it’s already tough to translate the pod count in actual yield (the crop is not mature enough), on top of this there’s also a crop tour bias… However, my model is saying 49.2.

Anyway, seems like the crop tour is really entertaining those who are behind a screen and not in holidays and also, this is for sure a nice few nights of binge drinking between the scouts!

Big miss on the German ZEW (10 versus 14.8 expected) while there was a good surprise on UK Public Sector Borrowing, down -£0.8b. EURUSD is trading down, between 1.1750 and 1.1775. It’s dragging the British pound down to just above 1.2825 (GBPEUR cross rate is dangerously approaching 1.09).

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