Today’s Prices
Grain prices finished mixed today with corn and soybeans on either side of unchanged while wheat rallying back following 2 days of big losses.
Weekly Price Summary
Grain Market News
High Temperatures
Temperatures are mostly favorable, we have virtually the entire U.S. corn and bean belt in the 80s although we did see a few 90s in Nebraska and Kansas.
7-Day Observed Precipitation
Precipitation shows that favorable rain in the western belt from the border of Nebraska and South Dakota through southwest Iowa, almost all of Missouri, and northern Arkansas.
That area saw a good rain event this week with additional rain in southeast Minnesota and northeast Iowa.
Pockets that have not seen rain in a week in most of South Dakota, most of Kansas and Oklahoma, as well as very little rain in the eastern belt or Ohio valley.
Now we believe that there is enough soil moisture in the eastern belt that crop conditions wont decline, but they may stabilize based on a dryer week.
Overall as we mentioned corn conditions may hold steady or rise a little and we expect beans to be up 1-2%.
7-Day Precipitation Forecast
The forecast shows moderate rain in the northern and eastern belt.
That should keep conditions mostly favorable there, unfortunately those dry areas of the Dakotas, Nebraska, and Kansas are not expecting much rain and crop could continue to deteriorate in those areas.
Much of Texas, western Louisiana, southern Oklahoma could see a big rain event next week with 4-6 even 6-10 inches of rain are possible.
Nobody wants 6-10 inches of rain, but these rains will be very beneficial when it comes to improving soil moisture as we head towards the winter wheat planting season.
Temperature Outlook
Mostly favorable outlook with near normal temperatures in the 6-10 an the 8-14.
With precipitation normal to a little above in the 6-10 and about normal to a little above in the 8-14 day.
Overall, we view this as a mostly favorable forecast going forward.
Grain Market News
China Map
The north China plain, which is their primary or largest growing area, for the most part has not been impacted by the drought conditions.
The Yankee valley which is the second largest producing area is where the drought conditions are getting quite severe in some locations.
Soil Moisture
The north China plain is in good shape while the Yankee valley is very dry and that’s where the drought alert has been issued.
Vegetation Health in China
Compared to last year most of the Yankee valley sees vegetation health below last year, the north China plain more mixed.
Although vegetation health is lower in the central portions of the north China plains, we are not hearing any major problems.
China: Corn Production
The north China plains produces the bulk of Chinas corn but dryness in the Yankee Valley is about 25% of China’s corn production.
China: Soybean Production
China isn’t a major exporter of soybeans but if they don’t produce a decent crop, they could require more imports.
The north China plains is the primary growing area for soybeans, but the Yankee valley still account for almost 20% of production.
Bottom line is that the area being affected by drought in China is a major grain producing rea and we will have to monitor that situation over the next couple of weeks.
September Corn Chart
Corn prices had a god day today with an outside day up meaning we took out yesterday’s high.
Currently the corn market has been able to hold major chart support where the 10-, 20-, and 40-day moving averages are all converging.
For about month now we can see that we are close to the middle of that trading range as traders wait for fresh information.
Technical indicators also in a neutral position, dead center in the middle of a neutral range but today’s rally has started to hook the technical upward.
Looking at the chart and the technical alone it is hinting this market may want to test the 6.36-6.42 range as we head into next week.
September Soybean Chart
Soybean prices also finding support where some of our moving averages are converging.
Bean were not as impressive as corn, but the bean market is also stuck between overhead resistance and chart support over the last month.
The trade is waiting for fresh information.
Beans bouncing Wednesday and Thursday and being able to hold those today has allowed the technical to start showing signs of hooking.
The bean market is hinting that it may want to test overhead resistance in the 14.40 range.
September KC Wheat Chart
Wheat prices got hit hard on Wednesday and Thursday but bounced back closing about 30 cents higher today.
We do believe that wheat was overdone to the downside and we believe that wheat prices are now undervalued from a fundamental perspective.
This is no place to be making wheat sales.
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