Corn Market Update

? Prices:

• September Corn (CU): $3.91 3/4, up 2 1/2 cents; inside day
• December Corn (CZ): $4.12 1/4, up 1 1/4 cents; also inside day
• September/December Spread (CU/CZ): -20 1/2, up 1 1/4 cents

? Market Headlines:

• Weekly ethanol data from the EIA this morning showed daily average production in the week ending July 25th at 1.096 mil bbls/day, which is up 1.7% from last week and up just 0.1% from the same week last year. This is also a new six-week high.

• EIA showed ethanol stocks in the week at 24.716 mil bbls, which is up a little over 1% from last week and and up a little over 4% from the same week last year. This a new 10-week high stocks figure.

• We estimate corn usage in the week at 108.3 mil bu, which brings cumulative marketing year corn usage to 4.979 bil bu. This compares to 4.851 bil bu through the same week last year and the USDA's full marketing year forecast of 5.500 bil bu.

Summary:

Corn futures closed moderately higher on Wednesday, supported by fund unwinding of long soybean/short corn positions and also long wheat/short corn positions. Ethanol data in the weekly EIA report continued to lean supportive, with corn grind topping the pace needed to reach the USDA's target for a ninth consecutive week, but otherwise, the news cycle again remained slow for another session.

Soybean Market Update

? Prices:

• August Soybeans (SQ): $9.67 3/4, down 14 cents; new low for the move at 9.67 1/2
• November Soybeans (SX): $9.95 3/4, down 13 3/4 cents; new low for the move at 9.95 1/4
• August Soybean Meal (MQ): $260.70, down $1/ton; new contract low at $258.60
• August Soybean Oil (LQ): 56.50, down 1.04 cents/lb; new high for the move at 58.00
• August/November Spread (SQ/SX): -28, down 1/4 cent; new contract low at -28 3/4

? Market Headlines:

• Not a lot of headlines in the soybean market today, with beans making new lows for the move, bean oil making new highs for the move, and bean meal making new contract lows.

• Soybean oil saw sharp losses going into the close on Wednesday, with spot futures losing some 50-60 points over the span of the last 15 minutes of trading.

Summary:

Soybeans closed lower for an 8th consecutive session on Wednesday, as the combination of friendly August weather and the lack of a trade announcement with China continued to weigh on prices throughout the day. EIA will release updated monthly biofuel stock usage tomorrow, while monthly census crush data from the USDA is due out on Friday, though there is little else on the docket in the short term that looks to significantly alter the current fundamental landscape.

? Prices:

• September Chicago Wheat (WU): $5.23 3/4, down 6 cents
• December Chicago Wheat (WZ): $5.44 1/4, down 5 3/4 cents
• September/December Spread (WU/WZ): -20 1/2, down 1/4 cent

? Market Headlines:

• Russian media reported today that farmers there have so far harvested around 50 MMTs of grain, while private analyst SovEcon raised their wheat production forecast for the country from 83.0 MMTs to 83.6 MMTs, which is in line with the USDA's forecast of 83.5 MMTs.

Summary:

Chicago wheat futures closed lower on Wednesday and look to be making a run at testing the contract lows made last May. Russian harvest remains ongoing, with traders continuing to see elevated export competition through the remainder of the year as providing resistance to prices on any sort of sizeable rally.

Corn

• Corn futures have made new contract lows over the past week, as downward price momentum has remained in place. First support this week comes in at 3.77 on the continuation chart, which marks the reaction low from last September, and then below here near 3.60, which is the low from 2024.

• Resistance this week will come in first at the psychological $4 level, which also marks 50% retracement of the recent down move seen the last couple weeks, and then above here at the July 18th high at 4.11. Our major upside objective then remains the open chart gap from 4.13 to 4.17 1/4.

• RSI today is approaching oversold territory, registering at 35.1.

Soybeans

• No new contract lows quite yet in the soybean market, but prices have nonetheless made new lows for the move in recent days, with downward momentum remaining firmly in place here also. Support this week will come in at the contract low at 9.64, and then below here on the continuation chart at 9.45 1/4.

• Upside resistance this week will be seen at the even $10 level, with 50% retracement of the recent down move coming in at 10.06 1/2. Above here, the July 18th reaction high at 10.37 1/4 will be next resistance, and then the open chart gap from 10.47 to 10.50 3/4 remains our longer term upside objective.

• Like corn, RSI in the soybean market is approaching oversold territory this week, registering today at 30.3.

In Other News

• Livestock markets finished mixed at mid-week:
• August live cattle: $233.07, up $3.35; new contract high at $233.75
• August feeder cattle: $338.95, up $2.75; new contract high at $339.70
• August lean hogs: $107.02, down 22 cents

• Outside markets saw mixed trading on Wednesday:
• Crude Oil Futures: up 80-90 cents/bbl
• Stock index futures: The Dow Jones index is down 350 points, the S&P500 index is down 30 points, and the NASDAQ is down 45 points
• US $ Index: up 90-100 points

• This morning's EIA report also gave weekly petroleum stocks data for the week ending July 18th:
• Crude Oil Stocks - up 7.698 mil bbls to 426.691 mil bbls
• Gasoline Stocks - down 2.724 mil bbls to 228.405 mil bbls
• Distillate Stocks - up 3.635 mil bbls to 113.536 mil bbls
• Implied gasoline demand in the week was estimated at 9.152 mil bbls/day, compared to 8.967 mil last week and 9.250 mil in the same week last year.

• Metals futures, specifically copper, traded to sharp losses on Wednesday as President Trump announced a universal 50% tariff on imports of semi-finished copper products that is set to go into effect on August 1st.

• President Trump on Wednesday also announced 25% tariffs on goods imported from India, which are also set to go into effect on August 1st, and also added that there would be an unspecified penalty for India buying Russian arms and oil. Indian sources aid they were studying the implications of Trump's new measures while still remaining dedicated to securing a fair trade deal with the US.

• Lastly in the 'other news' category for Wednesday, Federal Reserve Jerome Powell expectedly held interest rates unchanged again for a fifth straight meeting. Following the announcement, the CME's FedWatch tool now shows a roughly 47% chance of a quarter-point cut in September, which will be when the next FOMC meeting is held.

Weather Outlook

? Short-term Forecast:

• Mid-day weather forecasts were like the overnight runs, and continue to show fairly good rainfall coverage in the west-central and north-central parts of the Cron Belt between now and the end of the week.

• Beyond here, there is also fairly good model agreement on a drier pattern then emerging for the area for a few days into next week, with little to no precip expected for most of the Corn Belt Sunday through next Wednesday.

• Like we mentioned this morning, a cold front is working its way across the central US today which looks to significantly drop daytime highs the rest of the week and into the weekend. In the meantime, heat looks to return to the west and northwest, where well below average temps have been in place for the past 10 days or so.

? Extended Forecast:

• Extended range precip forecasts are also similar to recent days, and continue to see above average rainfall potential for generally the northern and eastern parts of the Corn Belt, while dryer conditions are seen elsewhere.

• Our confidence remains low in regards to extended range temperature forecasts, as the models have continued to zig and zag throughout the day. Today's EU model run shows a bigger pocket of cooler air lingering in the central US in the 10-15 day period than was seen yesterday, while the GFS model still has mostly average to above average temps in the area. There is agreement on heat for both the West and East Coasts, but it this mid-section of the US that the models are having troubles with.