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July 16th- Midday Market Commentary

07/16/2021
July 16th- Midday Market Commentary

Grains are mostly higher at midday:

Sept Corn -1 1/4  cents/bu (5.63)

Dec Corn + 2 1/4  cents/bu (5.58 1/2)

Nov Soybeans + 17 1/2  cents/bu (13.97 1/2)

Sept Chi Wheat + 23 3/4  cents/bu (6.95 3/4)

Cdn $ +0.00160 (79.47 cents)

WTI Crude Oil +0.34/barrel (71.99)

Wanstead Farmers Co-op is currently drying our tough Soft Red Winter Wheat (SRWT) deliveries.  With our wet bins full of tough SRWT, we will be unable to accept delivery of tough Soft White Winter Wheat until sometime early next week.

The Co-op is continuing to offer our drying charge holiday on wheat deliveries up to 17.0% moisture (shrinkage still applies).  This program was instituted to encourage growers to preserve quality of their wheat by harvesting it before it was fully dried down.  Thankfully, many of you have taken advantage of the program.  With moisture levels falling off dramatically, we are re-evaluating how long the program stays in place.  It is definitely in place for the balance of today, but there are no guarantees as we head into the weekend.  We will post any changes in our commentaries later today and update the website accordingly.

In market news….

  • This morning, the USDA confirmed the sale of 134,000 tonnes of U.S. soft red winter wheat to China in 2021/22, which started June 1.
  • Corn prices started selling off shortly after the Commodity Weather Group released a report stating that below-trend yields are no longer likely, unless August goes hot and dry, and it is focused on how far above-trend yields might be.
  • Another frost risk for southern Brazil is forecasted for Monday and Tuesday mornings. Parana has corn that is still vulnerable due to late planting this year.
  • The Rosario Grain Exchange raised its Argentine corn crop estimate by 500,000 MT to 51 MMT, citing better-than-expected yields. The exchange reports 75% of the crop has been harvested to date.

And the main story of the day… Grain markets are higher based on hot/dry weather forecasts for the Plains and western Midwest for the next 10 days! The wheat crop is burning up!! The market is also realizing that for much of the North American Hard Red Spring crop, any rains now will come too late to materially impact overall production potential.  That will shift some demand into other classes of wheat (Kansas City and Chicago), and we expect to see speculative money continue to flow into the entire wheat complex as a result.

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