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E-Visor Reports: Market Watch

 
Friday, July 10, 2020
The highlight of today’s session will be the release of the monthly WASDE report. This release will incorporate the June stocks and acreage figures and likely give us some noticeable changes in balance sheets. The most interest will likely fall on corn where the average carryout estimate on the 2020/21 marketing year is 2.68 billion bu. This compares to the 3.32 bbu that was released in June. The loss of acreage is the leading cause of this decline as most analysts are holding their yield estimate steady at 178.5 bushels per acre. Any decrease to yield and we could easily receive a friendly reaction in the market. Fewer changes are expected to the soybean balance sheets today. The average guess on new crop ending stocks is 416 million bu compared to 395 mbu in June. This is mainly from the higher stocks and bump in acreage from the end of June reports. Trade also tends to make fewer changes to soybean production until we get through July as weather has more of an impact on the crop in August and September. While much of the attention on today’s data will come from production, we cannot forget the usage side. For corn we have seen ethanol demand increase in recent weeks and exports remain strong which could further reduce ending stocks estimates. Demand has not been as high on soybeans, mainly exports where Brazil continues to supply the world with much of its needs. Brazil will likely exhaust its soybean exports in another month or so, and it is unlikely the USDA will adjust balance sheets until then. Once this data is released, trade will quickly return to monitoring weather for daily price discovery. This is especially the case ahead of a weekend with some forecasters predicting a return to extreme heat cross the Corn Belt next week. 

Highlights
* Drought builds in SAM
* Consumer confidence impacting commodity outlook
* Weather forecasts remain mixed
* Trade expecting rating decline next Monday
* China claims trade tensions are highest since 1979 with US
* Doubts remain over Chinese long-term buying
* China still listed as main buyer of US corn/soybeans last week
* US cattle/hog weights continue to decline
* Country movement slows again
* July WASDE report at 11:00 AM CST

Corn
* Corn yield estimate at 178.6 bpa, crop at 15.04 bbu 
* Production -954 mbu from June
* 2019/20 carryout est 2.27 bbu
* 2020/21 carryout est 2.68 bbu
* 2020/21 world carryout est 324.8 mmt

Soybeans
* Yield est 49.9 bpa, crop at 4.15 bbu
* Production up 25 mbu from June
* 2019/20 carryout est 584 mbu
* 2020/21 carryout est 416 mbu
* 2020/21 world ending stocks 96.7 mmt

Wheat
* All wheat production est 1.84 bbu
* Production -29 mbu from June
* 2020/21 carryout est 948 mbu
* 2020/21 world carryout est 315.9 mmt
* Trade focused on global production reports

Livestock
* US beef sales last week at 9,500 mt; an 8 wk low
* Pork sales last week at 31,500 mt
* China to auction 10,000 mt pork today
* Global meat production on decline
* Hog futures 32% off May high

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.