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E-Visor Reports: Market Watch

 
Friday, August 07, 2020
We are already starting to see positioning take place ahead of the August WASDE report that will be released next Wednesday. Many analysts are expecting to see elevated yield numbers, especially on corn given recent growing conditions and crop reports. The condition reports on both corn and soybeans are historically high though, and many have already raised projections from what the USDA projected in July. For corn most are expecting a yield closer to 182 bushels per acre, and soybeans closer to 51 bpa. These compare to the 178.5 bpa and 49.8 bpa a month ago. The real interest may be on what is done with usage, however. The USDA is predicting total usage to increase 990 million bu on corn and 448 mbu on soybeans from the old crop marketing year to new crop. Even with high export sales in recent weeks the USDA may want to see if the trend continues before adjusting the demand side of balance sheets. We also have to remember that any alteration to old crop demand will impact new crop as well. We have seen cancellations on old crop exports in recent weeks, which will automatically raise new crop ending stocks. The greatest changes to demand may be on the domestic side though, mainly ethanol and feed usage on corn and crush on soybeans. 

Highlights
* Weekly unemployment better, still 1.2 million claims
* US ethanol plants facing poor margins
* Ethanol futures -5.1% from week ago
* Heat returns to Corn Belt, noting extreme
* Weather remains favorable through mid-August
* Ukraine weather unfavorable for winter crop seeding
* Lebanon now has less than 12-month grain supply
* Wide range in US yield estimates being released
* Trade focused more on production than demand
* WASDE data next Wednesday
 
Corn
* Yearly export loadings -14.5% from year ago
* Corn ratings likely to hold steady next week
* Ethanol demand now in line to meet USDA estimates
* Vessel line up building in Brazil
* French crop estimate up 10.8%
 
Soybeans
* Better ratings likely next Monday
* Current crop rating 10% better than year ago 
* Analysts staring to increase Brazil export forecast
* Brazil exports drop in August, attention to planting
* Cumulative export sales 75 mbu ahead of estimates
 
Wheat
* Russian estimates continue to increase
* Spring wheat harvest advancing
* EU soft wheat exports only 1/3 of last year
* French wheat crop -25% from year ago
* Slow Black Sea sales support US demand
 
Livestock
* Weekly beef export sales 13,400 mt
* Beef sales -55% from last week, -40% from Last year
* Weekly pork sales 30,348 mt
* Pork sales -25% last week, +121% last year
* Pork to China for the year a record 1.15 mmt

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