It was all about Wheat on Friday as Corn and Soybeans were taking a breather, ending respectively up +1.75 cent and flat. Indeed, Wheat continued to go down as the availability of feed grain will be good, there was also some profit taking and Russia threat to ban export is failing to materialize. Wheat ended down -7.25 cents in Chicago, -8.00 cents in Kansas and -9.00 cents in Minneapolis. In Europe, MATIF dipped by -€3.25 and London Feed by -£0.85. In Chicago, funds
This is a red Monday so far: Soybeans are down -14.75 cents, -3.25 cents for Corn and -7.50 cents for Wheat in Chicago. MATIF is down -€2.75 and London Feed is taking a rest day, August bank holiday.
Last week was driven by the confirmation US is looking for a very nice corn and soybean crop as well as Wheat correcting harshly on technical, by correlation to Corn and Soybeans as well as Russia still exporting like there’s no tomorrow. Soybeans ended the week down -4.48%, SoyMeal -5.27% and SoyOil -0.28%. Corn moved down -4.38% in Chicago and -3.42% on MATIF in euro (EURUSD was up +1.61%). Wheat was the goat of the week with -8.16% in Chicago, -8.10% in Kansas and -5.88% in Minneapolis. On the other side of the Pond, lower US dollar did not help and MATIF was down -5.59% in euro (-4.07% in US dollar) and London Feed was down -4.95% in British Pounds (GBPUSD was up +0.73%).
ProFarmer tour is over. In all states but one they landed better yields. Illinois is increased by +6.59% from last year’s tour to 192.63 bushels per acre, however, USDA has pegged the yield at 207 bushels per acre, this is a -3.96MT difference. It is difficult to demonstrate and a bit subjective, but on a good year, it seems like Pro Farmer Tour is always having a negative bias, in other words, their yield is below final yield. Time will tell but last year, they estimated 180.72 bushels per acre for Illinois and final actual yield was 201 bushels per acre. Another way to see it is USDA sees yield +2.99% in Illinois while Pro Farmer sees +6.59% as stated, so is USDA actually conservative? One thing is sure, Illinois looks damn good! Iowa is pegged at 188.2 bushels per acre by the Tour (179.79 bushels per acre last year, 202 bushels per acre for the USDA for this year and last year), Iowa is pegged at 188.2 bushels per acre by the Tour (179.79 bushels per acre last year, 202 bushels per acre for the USDA for this year and last year), Indiana is pegged at 182.33 bushels per acre by the Tour (171.23 bushels per acre last year, 186 bushels per acre for the USDA for this year and 180 and bushels per acre last year), Nebraska is pegged at 179.17 bushels per acre by the Tour (165.42 bushels per acre last year, 196 bushels per acre for the USDA for this year and 181 and bushels per acre last year), Minnesota is pegged at 178.67 bushels per acre by the Tour (191.54 bushels per acre last year, the only state seeing a reduction of yield according to the Tour, by -6.72%, 191 bushels per acre for the USDA for this year and 194 bushels per acre last year), Ohio is pegged at 180 bushels per acre by the Tour (164.62 bushels per acre last year, 180 bushels per acre for the USDA for this year and 177 and bushels per acre last year), South Dakota is pegged at 170 bushels per acre by the Tour (149.97 bushels per acre last year, the best perf of the Tour, +18.70% year on year, 170 bushels per acre for the USDA for this year and 145 and bushels per acre last year),… After the magic happens, the final US yield is seen at 177.3 bushels per acre versus 178.4 bushels per acre for the USDA, so a potential cut of -2.28MT compared to current USDA WASDE. But last year they forecasted 167.1 bushels per acre and it ended being 176.6 bushels per acre… So it could be that final yield will be even higher than current USDA estimates… Similar picture on Soybeans, a record yield of 53 bushels per acre is now expected, higher USDA WASDE (51.6 bushels per acre), a potential increase of +3.39MT of the US crop!
CFTC COT showed Reuters estimates was once again a bit irrelevant. Funds sold 6,136 lots of Wheat on during the week ending Tuesday (8,500 was expected), decreasing their long position to 60,812 lots. They bought 10,138 lots (Reuters was expecting a sell of 3,500 lots) of Corn, decreasing their short position to 14,824 lots. They also bought 18,875 lots of Soybeans (6,000 only expected), decreasing their short position to 40,049 lots. From Wednesday to Friday, it’s expected funds sold 10,500 Wheat, 25,500 Corn and 12,500 Soybeans.
Only stat today German IFO: 103.8 versus 101.9 expected, However, EURUSD is starting the week on a soft note, trading just above 1.16. GBPUSU is trading just below 1.2850.