Wednesday afternoon belonged to Apple Inc. (Nasdaq: AAPL). At Ceres in Chicago, all eyes were locked on CNBC as the Dow surpassed 22,000 and the technology giant pushed to an all-time high. But as the trading session concluded at the Chicago Board of Trade, chatter turned back to a report from FCStone on expectations for yield estimates in the month ahead.
That and the reality that we are operating in a weather market. With cooler temperatures and rain in the forecast over the next week, markets are sure to react to each inch that falls. Here’s our daily recap of grain prices from the Chicago Board of Trade.
Corn Prices Tick Higher
The September corn futures contract added 2.5 cents to close the day at $3.65. The December futures contract also added 2.5 cents and closed at $3.79.
The uptick came as markets digested wetter rain forecasts in the near future. That… and the fact that FCStone projected yields and production expectations that are far lower than the USDA’s July forecast.
FCStone reported yesterday that it expects the U.S. corn crop to come in at 13.59 billion bushels and yields of 162.8 bu/ac. By comparison, the USDA has projected 14.255 billion bushels and yields of 170.7 bu/ac.
Rain is also expected in the next 24 hours in Iowa, which could complement a state that trails Minnesota in yield expectations.
Tomorrow, I’m hanging onto weekly export sales numbers. I think we’re going to see some positive momentum for both new-crop and old-crop. It’s going to be a really competitive year between the U.S. and Brazil. Things all come down to demand. We have ample supply, and despite the recent downturn in quality forecasts from the USDA, we have to turn our attention to Mexico.
It’s problematic that our trading partner to the south is looking south for supply due to frustrations over NAFTA. But I won’t blame them for shopping around. And I certainly anticipate that data surrounding Brazil’s crop size is going to cause an event later this year.
I can see an overreaction when we get to the data later this month. It’s a good time to anticipate volatility because – that’s what half of traders want… a reset of sorts.
Finally, harvest numbers are falling on our desk as well. Texas has wrapped up 22% of its corn harvest, leading the way. That’s a really good number for this time of year. Last year, it was just 14%, while the five year average sits at 9%.
Soybean Prices Add Seven Cents
The August soybean futures contract added 6.5 cents, topping $9.70 at market close. Meanwhile, the November soybean futures contract added 5.25 cents to close at $9.775.
It was one of those days where data mattered most.
FCStone projected that U.S. production of soybeans would register at 4.235 billion bushels and 47.7 bu/ac on yields. The USDA had projected 4.26 billion bushels of production and yields of 48.0 bu/ac.
Wheat Prices Dip on Weather Forecasts
If you were expecting action in the wheat markets today, prepare to be disappointed.
The September wheat futures dipped 0.5 cents and closed the session at $4.60.
There was some pretty important news on the international front.
Japan is the largest buyer of American corn these days, but what about wheat? We learned today that Japan wants to purchase nearly 133,000 metric tonnes of wheat, and it’s reaching out to the U.S., Canada, and Australia.
Reuters reports that Japan is asking for 11,840 tons of western white, 13,300 of hard red winter and 24,940 of dark northern spring wheat from the United States.
Once again, this points out the importance of grain testing and knowing just how much protein is in your crop.