AM Comments August 6 2025
Good morning. Markets are again quietly mixed this morning to start Wednesday, with the soybeans higher and the grains trading near unchanged on what appears to be another slow news day at the Board of Trade. Corn futures have scored another round of new contract lows overnight, but other than that, the situation this morning is rather similar to how things were going home yesterday with there just being not a lot new for traders to discuss. On the spec side, nobody is going to take on new positions until more is known about US crop sizes, and on the producer side, cash sales by the farmer have seasonally slowed with the new crop harvest now right around the corner. Our best advice is to continue to be patient and stay aware that this is a futures market, meaning it won't trade current supply news forever. Corn futures at mid-week are trading unchanged to a penny lower, soybean futures are trading 3-4 cents higher, and the Chicago wheat market is trading unchanged to a penny lower as well. Products are mixed, soybean meal is down around 50 cents/ton and soybean oil is up 30-40 points. Outside markets are mixed/mostly higher, crude oil futures are up around $1/bbl, the Dow Jones index is up 130 points, and the US$ index is down 25 points; the S&P500 is up 10 points and the NASDAQ is up 30 points.
Today's Reports: EIA Weekly Ethanol Production/Energy Stocks
- August deliveries for Wednesday included just 518 contracts of soybean meal assigned by the CME Group last night.
- This morning's weekly ethanol report for the week ending August 1st is expected to show average daily production in the week between 1.900-1.109 mil bbls, while stocks for the week are seen between 24.016-24.825 mil bbls.
- Private consulting Safras y Mercado said on Tuesday in a monthly report that Brazilian farmers have sold around 78.4% of their soybean crop for the 2024/25 season, which compares to 82.2% through roughly the same date last year and the five-year average of 85.7%. Sales for next crop year stand at roughly 17% according to the group, compared to 22.5% last year and the five-year average of 26.8%.
- Cash connected sources are reporting that Chinese crushers on Tuesday sold as much as 2 MMTs of soybean meal as livestock producers looked to lock in forward supply coverage into the end of the year on fears of an ongoing US-China trade war. The sales come amid recent headlines of new Chinese purchases of Argentine soymeal, which have popped up in recent weeks amid a price discrepancy between cheaper South American supplies and those crushed domestically.
- Though not a major ag powerhouse, Latvia's government on Tuesday declared a state of emergency in the country after heavy rains and flooding in recent weeks caused fairly widespread crop damage. Similar to what happens in Russia, the emergency declaration will allow farmers to claim government aid from the state revenue service for loans and taxes through the beginning of November.
- The Purdue University/CME Group agricultural sentiment index fell to 135 points in July from 146 seen in June, with the current conditions component of the reading down 17 points on the month. According to the authors of the report, sentiment declined on the month as weaker farm income prospects weighed on the producer's view of current conditions and also future conditions.
- China's Ministry of Commerce on Wednesday announced that it would be extending what was originally supposed to be an eight-month probe into the country's beef imports now to late November, though didn't give a specific reason for the move. China's wholesale beef prices fell to their lowest levels since 2019 earlier this year.
- Ahead of a Friday deadline for a ceasefire in Ukraine given by President Trump a couple weeks ago, Russian President Putin and special envoy Steve Witkoff held talks in Russia on Tuesday regarding the situation, though details from day one of the talks are lacking this morning. Trump this week has threatened another round of sanctions, which sources say could get Putin to make some smaller concessions in an effort to avoid.
- President Trump told reporters on Tuesday that he would be naming a nominee to fill the Federal Reserve Board of Governors vacancy by the end of the week this week, and also mentioned that he had narrowed the list of possible replacements for Fed Chair Powell to four individuals. That announcement comes following comments earlier in the day regarding Treasury Secretary Scott Bessent no longer being in the running for the position.
- Ridge-riding thunderstorms in the northwestern Corn Belt look to continue being the main Midwest weather feature through the rest of the week and into the weekend, while the presence of a pair of tropical storm systems currently in the Atlantic has continued to cause fits for the outlooks into next week. The EU model run this morning shows scattered precip across the northwest ranging from a half inch to 2" generally speaking, with some locally heavier amounts possible.
- The south/southeastern part of the Midwest looks to continue holding in a drier pattern though, with areas east of the Mississippi and south of Chicago expected to see little to no rain between now and the beginning of next week. The models have better rain chances for the area then into the middle of next week, but as has been well-advertised, our confidence beyond the next few days is not great.
- Week two precip runs are little changed this morning, with the GFS remaining wetter in the period than the EU model in the southeast/eastern US, but drier than the EU in the northern Plains and Canadian Prairies. And on the temperature side, extended guidance this morning is cooler than yesterday, with the EU model keeping a sizeable pocket of cooler air in place now into August 21st. For the most part, major heat looks to continue being confined to the far northeast and areas west of the Rockies.