Afternoon report: Soybean futures find modest gains in Friday’s session.

Ben Potter, Senior editor

July 22, 2023

5 Min Read
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By the middle of next week, triple-digit temperatures will be seen over parts of the Midwest and Plains, but the weather will be relatively mild today through the weekend. That was enough for traders to engage in some more technical selling and profit-taking on Friday. As a result, corn prices fell more than 1.5% lower, with wheat losses ranging between 1.5% and 4%. Soybeans bucked the overall trend, picking up modest gains today.

Some rain will fall on the Midwest and Plains between Saturday and Tuesday, but very few fields will see more than 0.25” during this time, per the latest 72-hour cumulative precipitation map from NOAA. Further out, the agency’s new 8-to-14-day outlook predicts seasonally wet weather could return to the eastern Corn Belt between July 28 and August 3, with sharply warmer-than-normal temperatures likely for the entire central U.S. Currently, 50% of the soybean crop and 55% of the corn crop is in areas affected by drought.

 

On Wall St., the Dow is trying to capture a 10-day winning streak after moving another 69 points in afternoon trading to 35,294. Energy futures remained in the green as well, with crude oil up more than 1.5% this afternoon to $76 per barrel fueled largely by geopolitical tensions in the Black Sea region. Diesel climbed 2.5% higher, with gasoline trending nearly 2% higher. The U.S. Dollar firmed moderately.

On Thursday, commodity funds were net buyers of soyoil (+4,500) contracts but were net sellers of corn (-6,000), soybeans (-2,500), soymeal (-3,000) and CBOT wheat (-1,500).

Corn prices incurred moderate losses following a technical setback on Friday. September and December futures each fell 9.25 cents lower to close at $5.28 and $5.37, respectively.

Corn basis bids were mostly steady across the central U.S. on Friday but did slide 5 cents lower at an Illinois river terminal today.

Corn quality ratings have improved 7 points since last June, reaching 57% in good-to-excellent condition through July 16, observes Matthew Kruse, president of Commstock Investments. Still, it’s the worst shape the crop has been at this time of year since the notorious 2012 season. “While I see some moisture relief coming into the Eastern corn belt, many areas have already reached the point of no return,” he says. “One of our brokerage offices in Northeast Missouri reported that as much of half of their farm will go unharvested. There are many other areas that are struggling such as Nebraska, Southern Michigan, but the state of Illinois probably represents the largest corn producing region under threat of drought damage.” Kruse shares more observations in today’s Ag Marketing IQ blog – click here to learn more.

French farm office FranceAgriMer estimated that 82% of the country’s corn crop was rated in good-to-excellent condition through July 17, which was steady from a week ago and moderately better than year-ago results of 75%. France is Europe’s top grain producer.

Preliminary volume estimates were for 308,826 contracts, which was moderately below Thursday’s final count of 356,005.

Soybean prices managed modest gains after some light technical buying on Friday. August futures added 5 cents to $15.00, while September futures picked up a penny to reach $14.2725.

The rest of the soy complex was also in the green today. Nearby soymeal contracts shifted nearly 0.5% higher, while soyoil prices jumped as much as 2.75% higher.

Soybean basis bids were steady to soft after fading 5 to 30 cents lower across four Midwestern locations on Friday.

How do you define sustainability? Iowa farmer Lance Lillibridge had to think hard about that question after facing catastrophic flooding in 2008. “After chatting with Lillibridge, it dawned on me: there is a big disconnect between corporate sustainability and farm sustainability,” notes Farm Futures executive editor Mike Wilson. “Sustainability means something different to each group.” Wilson expands on this idea in his latest This Business of Farming column – click here to learn more.

If it’s been a while since you’ve been to FarmFutures.com, our Friday feature “7 ag stories you can’t miss” is a great way to quickly catch up on the industry’s top headlines. The latest batch of content includes new research funding for lowering methane emissions, the impact Canadian wildfires could have on lumber prices and more. Click here to get started.

Preliminary volume estimates were for 180,499 contracts, slipping slightly below Thursday’s final count of 187,927.

Wheat prices were slashed despite Russia’s continued attacks on Ukrainian port infrastructure this week as traders locked in profits after prices rose sharply higher earlier this week. Seasonal harvest pressure generated some additional headwinds. September Chicago SRW futures lost 30.5 cents to $6.9650, September Kansas City HRW futures fell 13.75 cents to $8.61, and September MGEX spring wheat futures dropped 13 cents to $8.89.

Russian attacks on Ukrainian port infrastructure have been happening for four consecutive days after damaging grain terminals in Odesa earlier today. There have also been reports of Russian training exercises for capturing shipping vessels. The Kremlin says these moves are in retaliation of Ukraine’s recent attack on a bridge in Crimea. Russia and Ukraine are both among the world’s top wheat exporters.

Meantime, Turkish president Tayyip Erdogan is touting his planned talks with Russian president Vladimir Putin could lead to a renewal of the Black Sea shipping deal that expired earlier this week. “We are aware that President Putin also has certain expectations from Western countries, and it is crucial for these countries to take action in this regard,” Erdogan also said.

French farm office FranceAgriMer reported that 58% of the country’s soft wheat crop has been harvested as of July 17, up from 33% a week earlier. That’s well behind 2022’s pace of 79%.

Taiwan issued an international tender to purchase nearly 4.0 million bushels of grade 1 milling wheat from the United States that closes on July 27. The grain is for shipment starting in early September.

Tunisia, which is already a major wheat importer, may have even bigger needs moving forward after the county’s agriculture ministry said its grain harvest is down 60% this season. The North African nation primarily produces durum wheat but has faced severe hot, dry conditions earlier this year.

Preliminary volume estimates were for 157,022 CBOT contracts, tracking moderately below Thursday’s final count of 243,066.

About the Author(s)

Ben Potter

Senior editor, Farm Futures

Senior Editor Ben Potter brings two decades of professional agricultural communications and journalism experience to Farm Futures. He began working in the industry in the highly specific world of southern row crop production. Since that time, he has expanded his knowledge to cover a broad range of topics relevant to agriculture, including agronomy, machinery, technology, business, marketing, politics and weather. He has won several writing awards from the American Agricultural Editors Association, most recently on two features about drones and farmers who operate distilleries as a side business. Ben is a graduate of the University of Missouri School of Journalism.

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