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Afternoon Market Recap for June 20, 2019, 22.06.19

When will weather be kind to corn?

Afternoon Market Recap for June 20, 2019

Mid-range forecasts look more positive, pushing down grain prices Friday.

Despite plenty more wet weather across the central U.S. over the next several days, CPC’s latest 6-to-10-day outlook calls for mostly warmer, drier weather, which could pump up corn yield potential in struggling areas. As such, grain markets docked corn prices around 1.4% Friday on a round of profit-taking, with plenty of downward pressure also applied to soybean and wheat prices today.

But for now, a round of severe weather is raking parts of the central U.S., and over the next three days, parts of Oklahoma, Kansas, Missouri Iowa and Illinois could see upwards of another 3” of total rainfall, per the latest 72-hour cumulative precipitation map from NOAA. And it’s the first official day of summer Friday, but daytime highs will trend cooler than normal in the Midwest and Plains at least through the middle of next week.

On Wall St., gains in banking stocks and other stocks should help the Dow close out a very strong week after picking up another 50 points this afternoon to reach 26,802. Tensions between the U.S. and Iran remain high, meantime, which pushed energy prices higher again today. Crude oil was up another 0.7% to $57 per barrel, with gasoline and diesel trending noticeably higher. The U.S. Dollar softened moderately.

The upper Mississippi River is again fully open to barge traffic today, but hundreds of delayed barges quickly created a bevy of logistical problems as they began to maneuver once more. The Mississippi River is the primary node of transport for about 60% of the nation’s corn and soybean exports.

Corn prices ran into a round of profit-taking Friday after hovering near five-year highs for much of the week. July futures slumped 7.75 cents lower to $4.4225, with September futures down 7.25 cents to $4.4750.

Corn basis bids were steady to firm Friday, moving 1 to 6 cents higher across multiple Midwestern locations today.

With plenty of rain in the forecast, traders are already anxious to see USDA’s updated acreage estimates, which are out a week from today. A further cut in acres could keep the agency’s current production estimate of 13.68 billion bushels on a downward trajectory.

Based on reports on Feedback From The Field, it appears prevent plant could claim 5 million to 7 million acres. Farmers with unplanted corn ground said they diverted around 31% of those acres to the crop insurance program. Click here to read the latest farmer anecdotes and view our interactive map.

According to the latest monthly grains report from Argentina’s government, the country’s corn production for 2018/19 is on an upward trend, with farmers harvesting as much as 2.244 billion bushels later this year.

French consultancy FranceAgriMer slightly lowered its assessment of the country’s 2019 corn crop quality, from 82% in good-to-excellent a week ago down to 81% as of June 17.

For some time now, many have been wondering when the USCMA will be ratified by Congress. But the latest from House Ways and Means Trade Subcommittee chair Earl Blumenauer (D-Ore.) is “it’s not going to happen” ahead of Congress’s August recess. Still, Mexico’s Senate ratified USMCA earlier this week, bringing the trade deal one step closer to fruition. Legislatures in Canada and the U.S. still must ratify USMCA before it goes into effect.

USDA announced Friday that if you have expiring CRP contracts, you are now able to “re-enroll in certain CRP continuous signup practices or, if eligible, select a one-year contract extension.” The agency’s Farm Service Agency is also accepting applications for first-time enrollments through August 23. Click here to learn more.

Preliminary volume estimates were for 387,274 contracts, falling moderately below Thursday’s final count of 498,243.

Soybean prices also succumbed to a round of profit-taking Friday, falling around 1.3% in the session. July futures dropped 12.75 cents to $9.0275, with August futures down 13.25 cents to $9.0850.

Soybean basis bids were mostly steady across the central U.S. Friday, moving 5 cents higher at a Nebraska processor and 3 cents lower at an Ohio elevator today.

South Korea purchased 60,000 metric tons, likely from Brazil, in an international tender that closed earlier today, and for arrival by mid-November.

Preliminary volume estimates were for 217,789 contracts, shifting 24% below Thursday’s final count of 288,220.

Wheat prices took small to moderate losses Friday, primarily on spillover weakness from stumbling corn and soybean prices. July Chicago SRW futures eased 0.5 cents to $5.26, July Kansas City HRW futures dropped 7.75 cents to $4.5275, and July MGEX spring wheat futures slipped 2.25 cents to $5.3750.

Heavy rains and flooding are slowing the winter wheat harvest in Kansas, the top U.S. production state. The slow pace is likely to continue, with USDA marking 21% of the state’s crop mature, versus 60% at this time a year ago.

Argentina farmers plan to plant slightly more wheat acres for 2019/20 than previously reported, according to its government’s latest monthly grain report. Latest estimates are for 16.062 million acres.

French consultancy FranceAgriMer held steady its assessment of the country’s 2019 soft wheat crop quality, showing 80% in good-to-excellent condition as of June 17. And 75% of the country’s barley is in good-to-excellent condition, up from 74% a week ago.

Preliminary volume estimates dropped to 95,536 CBOT contracts, down moderately from Thursday’s final count of 128,947.

Afternoon Market Recap for June 20, 2019

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