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Easy Math

agweb.com, 30.07.20


Well, it certainly does not take a math whiz to work out this equation. Moisture + seasonably warm temperatures = higher crop ratings. Of course, this generally leads then to the next assumption that; higher crop ratings = lower futures prices. Granted, that second part is not an absolute, but it has worked in the overnight trade as we have generally lower prices on the screen in the grain and soy market.

According to NASS, as of the 26th of this month, both corn and beans are now rated 72% good/excellent, which was an improvement of 3% for each. 82% of the corn is now silking, 7% ahead of average, and 76% of beans blooming, 4% ahead of the norm. Looking at other crops, we find that 84% of the cotton was squaring, 2% behind average, 44% of sorghum is headed, 81% of winter wheat has been harvested, -1%, and spring wheat was rated 70% good/excellent, up 2%.

Looking around the globe, we find that the independent consultant Agritel is now projecting a French soft wheat crop of 29.22 MMT, which would be 26% lower than last year. While this is not shocking news to anyone in the industry, it does fall below most estimates that have been in the 31-32 MMT range. The last estimate by the French Farm ministry was 31.3. Harvest is now 71% complete in that nation. Providing a counterbalance to this, the Russian consultant, IKAR, bumped its estimate for the Russian wheat output 1.5 MMT to 78. This compares with the “official” government estimate of 75 MMT.

Looking to the Southern Hemisphere, the safrinha corn harvest in Brazil has reached nearly 56% complete, which is less than 1% behind average. In Argentina, corn harvest has reached 95% complete, and if they replicate the progress made this past week again, they should be virtually wrapped up by this weekend.

In one of the more bizarre tales I have heard in some time, there have been reports now from at least eight different states of people receiving packages of seeds in the mail. I have not heard of what type of seeds these are, but evidently are of varying size, shape, and color, usually unmarked and are believed to be coming from China. Some packages were actually labeled as jewelry. I do not know about you, but if I received an unsolicited, unmarked package of seeds in the mail, the last thing I would do with it is plant it and would probably be tempted to burn it. Regardless, the Department of Ag’s of the various states where these are showing up, have issued warnings and ask recipients to contact them for instructions on where the packets should be sent.

Marcos appear to be taking a breather this morning. After closing in on $1980 an ounce, gold has fallen back to around unchanged for the day. Energies and equities are lower, and after having pushed down to the lowest point traded since September of 2018 yesterday, the U.S. Dollar is slightly higher in the early rounds. It is interesting to note that this current push lower for the dollar is nearly identical in price and time to the swing lower that was witnessed during May/June. Longer-term this market should have more ground to lose but with daily indicators quite oversold, it could be in store for a corrective bounce.

https://agweb.com/blog/easy-math



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