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Grain markets finished mostly higher today partly due to a weather forecast that is mixed, but not ideal that’s for certain. Also rumors of China in buying U.S. soybeans providing support.
Weekly Prices Summary
Grain Market News
7-Day Observed Precipitation
Over the last 7 days we’ve seen a swath of rain in portions of the western belt. Much of this rain fell last week on Fri and Sat with only some scattered showers in western IA, southwest MN, and far southeast SD that took place last night and early this morning. It’s worth noting, a large area in the northern Plains has been completely dry, central and southern Plains has a pretty good area that has been completely dry, and a good share of the eastern belt has been completely dry over the last 7 days.
High Temperatures 8-5-21
Temperatures all week have been in the upper 70’s, low to mid 80’s. That is very good temperatures for growing crops given you have adequate moisture. We are starting to see some heat build in the Plains states with 90’s and 100’s. That heat is going to be intensifying in the Plains and pushing into the western belt over the next few days.
High Temperatures Forecast for Mon 8-9-21
High temperatures forecasted for Monday in the upper 80 and low 90’s across most of the belt. Upper 90’s and 100’s in the Plains. That is certainly going to provide some stress on crops where moisture has been getting short.
Today’s radar showing just a few scattered showers. We did get some rain last night in parts of the western belt but most of the belt has remained dry for the bulk of this week.
7-Day Precipitation Forecast
Good news for farmers in southern MN, IA, northern MO, IL, etc, there is some pretty good rain the forecast. Most of the rain in the 7 day forecast is scheduled to fall tomorrow and into Sunday. After that we get into a drying trend again. If this forecast is correct some very beneficial rains could fall in some key areas of the western belt, specifically IA and southern MN, and even nudging into eastern NE. The key going forward is whether these rains develop. Will it be the forecasted amount, more, or significantly less. That’s going to be the major contributed to price direction come Monday. Prices on Monday could be up or down sharply based on the amount of rain that falls over the weekend.
6-10 and 8-14 Day Forecast
Weekend rains are going to be even more important given the fact that the 6-10 and 8-14 day showing above normal temperatures and below normal precipitation in the northwestern half of the belt. So the rains this weekend will be very important.
Grain Market News
Vegetation Health Index
This map shows the vegetation health index. The northern Plains show poor vegetation health as well as the Pacific northwest. It’s also worth noting the extends into the Canadian Prairie as well. Very little green or blue in those areas.
Vegetation Health Index vs YA
This map shows the vegetation health compared to last year, the northern Plains are dry and the Pacific northwest is dry. It’s also interesting to note that areas like IN, IL, and MO show poorer vegetation health than a year ago. One point, the vegetation health in the southern Canadian Prairie. Manitoba, Saskatchewan, and Alberta seeing conditions much below a year ago and we’re hearing the drought conditions in some of the southern Canadian Prairie the worst they’ve ever seen.
Canada: Spring Wheat Production
This map is Canada’s spring wheat production. In Saskatchewan soil moisture is reported at 97% short to very short. It’s also being reported that pasture in Saskatchewan are 81% poor or very poor. Saskatchewan is a major producer of grains in Canada. When we look at spring wheat, Saskatchewan is the 41%, the largest providence of any, of spring wheat and account for 45% of total wheat production. So easily the largest producer for wheat is Saskatchewan and they’re having a terrible. It’s also worth noting that Saskatchewan produces 41% of Canada’s Barley and 52% of Canada’s Oats. So by far and away the largest producers of small grains in Canada.
Canada: Canola Production
On of Canada’s primarily crops in Canola and Canada is the worlds largest exporter of canola. Saskatchewan produces 53% of Canada’s canola crop and again, Saskatchewan is 97% short to very short in moisture. It’s a disaster taking place within the southern Canadian Prairie, the heart of their grain growing region.
December Corn Chart
Corn prices are chopping in a very narrow range as the market waits for fresh information to drive us out of that range. Technical indicators are also stuck in the neutral mid-range. It could we weather that pushes us out of the range, it could be Chinese buying, or it could be tightening of the balance sheet by USDA. For now, the market is content to trade on either side of $5.50 in the new crop Dec corn.
November Soybean Chart
Soybean prices have also turned more sideways and choppy over the past month. We did push down towards the lower end of the recent range but Chinese buying today and yesterday gave beans a little bit of a boast and then weather and next week’s crop report combined with the possibility of additional Chinese buying could be the drivers next week. But with prices near the lower end of the range and technical indicators into the oversold range and now hooking upward, this is not a place to be making sales in soybeans.
September KC Wheat Chart
Wheat prices rebounded nicely today. We’re in an uptrend off the lows established back around early July. Wheat prices have rallied $1.30 in just a little less than a month and over the last 30 days it’s the wheat market that has become the upside leader on lost production in U.S. spring wheat, lost production in Canadian wheat, and also lost production in Russia’s wheat crop.
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