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E-Visor Reports: Market Watch

 
Thursday, July 08, 2021
We are starting to see more positioning for the upcoming WASDE report. On the domestic side all interest will be on the incorporation of the data from the June 30th acreage and stocks reports. Soybean production is expected to remain steady from June as acres did not change and typically, we do not see yield adjusted this early in the growing season. A reduction to ending stocks is still expected as the quarterly stocks came in under expectations. Even if just minimal, any reduction to soybean reserves will be too much given our current stocks to use. This is not just on old crop, but new crop as well. We are likely going to see a different set of numbers on corn. Corn acres increased in the June revisions, although less than expected. This is still expected to give us a slightly higher production figure barring a significant change to corn yield. Old crop demand is pretty well dialed in at this time, and if anything we may see exports scaled back given our recent slow-down in sales and loadings. These may simply be off set by elevated domestic demand, however. The bottom line with next week’s report is that we are unlikely to see ending stocks elevated to a point where rationing will not be warranted.  

Highlights
* Buyers closely monitor country movement
* US drought area shrinking
* Higher values lead to global production expansion
* Most increase to be seen in Brazil
* So American river levels continue to decline 
* US basis values mixed
* US/China trade tensions building
* China/Australian tensions not impacting trade
* World food values remain elevated
* US dollar starting to limit export interest 

Corn
* US needs a 175 bpa yield
* Buyers pass on US corn for fall
* Brazil Safrinha harvest remains slow
* Commercials trim long positions
* China to increase corn plantings 
 
Soybeans
* Brazil June exports at 11.1 mmt
* Brazil exports -13% from last year
* US crush margins still firming
* Brazil farmers to expand plantings 3% 
* Mixed reports on US double cropping

Wheat
* Russian crop larger than expected
* Russian wheat undercuts global market
* US HRW yields reported as good
* Nearly all spring wheat in drought
* China buying large volumes of Australian wheat
 
Livestock
* US hog weights are down
* Average hog weights -3 lbs from last year
* US pork exports forecast to decline  
* Cattle slaughter very low
* Beef stocks starting to tighten

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