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Afternoon Market Recap for July 15, 2019

Profit-taking bleeds grain prices

Corn, soybeans and wheat all take double-digit losses to start the week

It was a rough start to the week for grain markets, which saw steep losses on a round of profit-taking, with rains in the forecast creating additional headwinds Monday. Corn and wheat prices sank around 3% lower today, with soybeans down around 1.25%.

Parts of the eastern Corn Belt are seeing some rainy weather today. Later this week, parts of the upper Midwest could also catch some moderate rainfall, per the latest 72-hour cumulative precipitation map from NOAA. Daytime highs start the week with a cool spell but will heat up to above-normal temperatures later this week.

Some uncertainty over earnings reports later this week had Wall St. slightly on its heels Monday, with the Dow dipping 11 points lower to 27,321 in afternoon trading. Energy futures were uniformly lower today, with crude oil, gasoline and diesel all down between 1.25% and 2.5% this afternoon. The U.S. Dollar firmed slightly.

Corn prices ran headfirst into a round of profit-taking Monday, losing more than 2.5% in the process. September futures fell 13.25 cents to $4.41, with December futures down 12.25 cents to $4.47.

Corn basis bids were steady to mixed Monday, falling as much as 13 cents at an Illinois river terminal but firming as much as 5 cents at an Indiana ethanol plant today.

Corn export inspections eased 6.3% week-over-week after coming in at 26.6 million bushels. The tally landed in the middle of trade estimates that ranged between 19 million and 31 million bushels. Mexico was the top destination, with 10.2 million bushels.

Ahead of the next crop progress report from USDA, out later this afternoon, analysts expect the agency to trim its corn crop quality ratings by a point, to 56% in good-to-excellent condition.

European Union corn imports for the first half of July reached 27.5 million bushels to kick off the 2019/20 marketing year.

Ukrainian consultancy ProAgro raised its forecasts for the country’s 2019 corn crop by 5.9% to 1.359 billion bushels.

After a cold, wet start to the growing season, some heat and dry weather wasn’t the worst forecast for corn and soybeans last week. But with little rain in the heart of the Midwest, some fields are fading from already variable levels according to growers posting Feedback From The Field last week. Click here to read the latest farmer anecdotes and view our interactive map.

Preliminary volume estimates were for 338,015 contracts, facing a moderate decline from Friday’s final count of 441,187.

Soybean prices dropped double digits Monday on a round of profit-taking and wetter mid-range forecasts. August futures fell 11.5 cents to $9.0175, with September futures down 11.25 cents to $9.0775.

Soybean basis bids were mixed at interior river terminals but moved 3 to 5 cents higher across a couple of other Midwestern locations today.

Last week’s soybean export inspection total was ahead of trade estimates that ranged between 18 million and 29 million bushels. Still, the weekly rate needed to match USDA forecasts moved slightly higher, to 32.7 million bushels. Cumulative totals for the 2018/19 marketing year, now at 1.416 billion bushels, have slowed 23% year-over-year. China was the top destination, with 16.9 million bushels.

Ahead of this afternoon’s crop progress report from USDA, analysts expect the agency to leave soybean quality ratings unchanged from a week ago, at 53% in good-to-excellent condition.

The National Oilseed Processors Association reported that U.S. soybean crush for June dropped to the lowest monthly total in nearly two years, at 148.843 million bushels. That was also moderately below analyst expectations of 154.405 million bushels. Flood-related downtime at multiple processing plants was partly to blame

European Union soybean imports for the first half of July reached 22.3 million bushels to kick off the 2019/20 marketing year. The EU imported an additional 760,000 metric tons of soymeal during the same period.

China sold a small amount (around 60,000 bushels) of its 2013 state soybean reserves at auction earlier today, which was 1.2% of the total available for sale.

Preliminary volume estimates were for 109,125 contracts, drifting moderately below Friday’s final count of 153,772.

Wheat prices moved significantly lower on harvest pressure and spillover weakness from other commodities today. September Chicago SRW futures fell 15.25 cents to $5.0775, September Kansas City HRW futures dropped 17.75 cents to $4.4950, and September MGEX spring wheat futures lost 9.5 cents to $5.3325.

Wheat export inspections fell below trade estimates that ranged between 14 million and 22 million bushels after landing at 11.6 million bushels last week. That was also nearly half of the prior week’s tally of 22.6 million bushels. Mexico was the top destination, with 2.1 million bushels.

Ahead of this afternoon’s crop progress report from USDA, analysts expect the agency to show 62% of the U.S. winter wheat crop has now been harvested, up from 47% a week ago. For spring wheat, analysts think USDA will hold its crop quality ratings steady, at 78% in good-to-excellent condition.

European Union soft wheat exports reached 14.7 million bushels over the first two weeks of July to kick off the 2019/20 marketing year.

Egypt purchased just over 120 million bushels of local wheat this harvest season, according to its supply ministry. Despite this, the country remains the world’s No. 1 wheat importer.

With weather turning hotter and drier in Russia, the country’s IKAR consultancy dropped its forecast for 2019 wheat production by 1.3% to 2.848 billion bushels and says it may make additional cuts moving forward.

In Ukraine, consultancy ProAgro has lowered its estimates for the country’s 2019 wheat production by 2.4% to 1.008 billion bushels.

Preliminary volume estimates were for 68,674 CBOT contracts, falling 29% below Friday’s final count of 96,453.

grainstable

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