Grain prices sharply lower today as the forecast models continue to add precipitation to the forecast combined with lower energy prices put pressure on all the grains today.
Grain Market News
30-Day Observed Precipitation
Any areas that are in dark brown or red are in pretty good shape like northeast Iowa, southeast Minnesota, into northern Illinois.
Much of Ohio looks like it’s in good shape as well as northern Missouri.
But areas that re in green have received less than 2 inches of rain over the past month and that’s less than half of normal.
Those green pockets like central and western Minnesota, portions of eastern Nebraska, parts of central Indiana, and certainly down in the southern plains into the Delta region are areas that will need to be monitored for crop stress.
In fact, crop stress is already being reported in the southern plains adown into the delta region.
One reason the markets aren’t excited is that when we look at the heart of the U.S. corn and bean belt, we don’t have those huge pockets lacking moisture, its just spotty areas here and there.
3-Day Observed Precipitation
This week we are not receiving much rain, in fact the heart of the U.S. corn and bean belt hasn’t received rain this week.
Some spotty rains in the far northern belt and far eastern belt like eastern Ohio are really about the only areas that have seen rain.
The heart has been completely dry this week and should be dry for the rest of the week.
This combination of dryness across the heart and the plains and combined with severe heat in portions of the plains and the Delta is likely to result in crop conditions dropping in next weeks update.
We can see the heat in yesterday’s high temperatures, 100s in the southern plains and over towards the delta region, and this area is seeing heat and severe dryness.
This isn’t the heart, but significant and major losses are likely in that part of the country.
Temperatures as of noon today, so temperatures will still rise, in the upper 80s low 90s across most of the heart with upper 90s near 100s in the delta down into the southern plains.
Today is the fourth day in a row that we are not seeing any rain in the heart.
7-Day Precipitation Forecast
Over the weekend we are supposed to get some rain in portions of Minnesota, northeast Iowa, and Wisconsin.
Then as we move into next week the eastern belt could see 1-2 inches of rain.
The delta could miss out on the rain and the plain states could miss out on most of the better rains as well.
Based on today’s forecast we do see better rain from central Iowa, central Missouri, and all the way east through Ohio.
The outlook for Saturday into Sunday shows the best potential for heavy rain is in Minnesota, Wisconsin, and northern northeastern Iowa.
Unfortunately, there could be some severe weather, but this is the area that’s most likely to see heavier rains.
Our 6-10 and 8-14 day forecast show heat to the southern US but cooling in the northern areas. Then warming up again in most of the belt as we move into the second week of the forecast.
But where we have the cool air coming out of Canada meeting up with the warm air down to the south is going to set up a battle ground.
That battle ground could create above normal precipitation for a good portion of the belt for the 6-10 and some into the 8-14 day as well.
This forecast is what had the market under some heavy selling pressure for the third day in a row.
Grain Market News
U.S. Corn Yield Estimates
Last year 2021 in the black dash line shows where USDA was estimating the yield, it dropped the yield in August but then bounced it back up and ended up at 177 at year end.
Ag resource by utilizing crop condition indexes which combine good, excellent, fair, poor, and very poor.
You can see that last year their condition, which is shown in the black line with white dots, very well tracked the USDA and final yield.
Based on that data, USDA yield this year is at 177 and the current crop condition index would put the crop at 175.3.
Ag resource believe that its going to be difficult for this year’s yield to reach last years record of 177.
Keep in mind if condition ratings fall next as we expect their yield model will fall as well.
Corn: Weekly Export Sales
Corn sales were positive but very small just 34 thousand tons, but we only need 181 thousand tons to reach USDA export forecast.
As you get into the last 2 months of the marketing year it’s the shipment of U.S. corn that becomes more important than the sales as most sales are for the next crop position.
Soybeans: Weekly Export Sales
Old crop soybean sales were a positive 204, that was a nice change from the net negative the past 3 weeks.
Positive sales are good given the fact that the level needed is negative, that means we have already exceeded USDA sales estimate.
Now it’s just a matter of getting those bushels shipped.
September Corn Chart
Corn prices down sharply today, down for the third day in a row and prices are now testing lows from about 2.4 weeks ago at 5.66.
Technical indicators aren’t really giving us much to go on, they turned up and down and up and down again as the market has been very choppy.
Unfortunately, overhead resistance right now comes in at 6.25, that’s the high posted Sunday night.
September Soybean Chart
Soybean prices down sharply today, in fact making a new low for the move.
That reinstates the downtrend that’s been in place off the highs posted in June.
Current overhead resistance in the upper $13 and current chart support down around 12.80-12.85.
September KC Wheat Chart
Wheat prices had a mixed day as we traded both higher and lower and then closed a little lower at $8.61.
The wheat market looks to be trying to carve out some bottoming action.
We have chart support around the $8.20-8.32 area and overhead resistance just shy of $10.
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