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E-Visor Reports: Market Watch

 
Monday, August 31, 2020
The majority of today’s session will be spent getting final month end positions in place on the September contracts. While most contracts have already been rolled, there are always a few left that increase market volatility in thin trade. Trade will again show interest in the weekly crop ratings tonight that are expected to show further declines in condition. This is not uncommon at this time of the year as the crops are maturing. Field scouts are claiming the lower conditions may be a result of the crops dying however, which is not a good situation. This is a sign the crops did not fully mature and tends to lead to lower test weights and quality issues later on. Even if the crops would receive rains now, they would likely be too late to provide much benefit, especially on crops that have been stressed for several weeks. In fact, rains at this stage of the year can sometimes been seen as negative as they can lead to harvest delays. This tends to be more of a factor in years with shorter old crop supplies, however. One concern with rainfall this year is in Iowa and the amount of corn laying over in fields, and how moisture could easily lead to additional quality loss. More immediate concern is on the dry conditions that continue to affect the US, mainly Iowa and Nebraska. Sharp losses in the US dollar are also giving the commodity complex ongoing support. 

Highlights
* Month End Positioning 
* Stats Canada to update acreage today
* Canadian grain stocks to be updated on Friday
* Brazil weather dry ahead of planting season
* US cutting back on Covid testing
* Gulf ethanol firms to $1.47/gallon
* China finds fewer corn auction buyers after rally
* More countries lower/remove import taxes
* China voices displeasure with US tariffs
* Gulf ports getting back to normal 

Corn
* Dec corn +18 ¾ last week
* Open interest declining in corn
* Brazil Safrinha 86% harvested
* Ukraine corn harvest underway 
* Brazil scales back Aug export total
 
Soybeans
* Nov soy +45 ¾ last week
* Export basis weakening
* Brazil soy supply larger than thought
* Global oilseed supply rising
* Chinese imports from Brazil +27% in July
 
Wheat
* French wheat crop -10 mmt year ago
* French wheat exports to decline 40%
* US not as competitive in global market
* Cheaper freight does benefit US
* Global wheat supply to remain adequate
 
Livestock
* Brazil to increase beef production 4% in 2021
* Brazil pork production +4.5% in 2021
* Taiwan to increase meat trade with US
* USDA says not enough safety measures on poultry processing
* Current guidelines to not prevent salmonella outbreaks

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.