E-Visor Reports: Market Watch

Friday, August 21, 2020
Pre-weekend positioning will be a key factor in today’s trade, with most interest on weather. The United States has turned dry in many areas with several showing below normal precipitation for the past several weeks and it is starting to show in crop stress. Lower crop ratings are being forecast for next Monday, and while not a surprise, trade is starting to ask if this is from the crop maturing or damage from lack of precipitation. While cooler temperatures and adequate subsoil moisture have helped to ease stress, they have not totally stopped it. In the past several years we have seen crops made or lost in late August and this year is no different. The USDA predicted lofty yields in the August balance sheets and current weather conditions are bringing them into question. To see declines would not come as a surprise. Before long we will start to receive more accurate field data and traders may wait for the information before adjusting current positions. Not only is volatility starting to increase in the futures market, but on the cash side as well. Many buyers across the Corn Belt are reevaluating their needs and storage capacity and adjusting bids to match. This is more predominant in the areas that lost storage space in Iowa. 

* Trade monitoring Gulf weather; tropical storms
* Weekend storms may affect production, especially in Texas
* La Nina probability at 70% this year
* 1 week from First Notice Day on Sep contracts
* CME to launch Brazil soy contract on Sep 21st 
* US/Chinese trade talks again being planned
* No details of when, where being released
* Ukraine new crop exports under year ago
* German crops suffering from dry conditions

* Freeze damage possible in Brazil crop
* Gulf corn supply declining
* Credibility of yield estimates doubted
* Market carry encourages holding inventory
* Argentine farmers to reduce plantings
* Argentine working to lower export taxes
* Pod counts indicate large crop
* Chinese soybean values rally
* Brazil weather favorable ahead of planting
* Export sales generate demand doubts
* Volatility rising
* Limits on Ukraine exports to benefit US
* Buyers cancel tenders due to price
* Export stocks building
* Russia makes further crop reductions
* August Cattle on Feed after the close
* August first on feed est 100.8% year ago
* July placements 106.2%; Marketings 99.6%
* China to auctions 10,000 mt pork today
* US beef export sales at 3-week high last week

RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.