CommStock Reports

Grains are expected to start steady to slightly firmer in follow up of a mild rebound on Friday. Trading volumes remain extremely light as farmers are busy with the start of harvest and while market participants wait on yield results from the field. In the Headlines The S&P 500 stock index lost about 3 percent in in just 3 days following last week's Federal Reserve meeting. The central bank chose not to raise interest rates, as expected, but comments from Fed Chair Jerome Powell were more hawkish than anticipated as he indicated that rates would stay elevated for a while. Forecasts for interest rates next year included only two rate reductions. Tight monetary policy remains necessary while inflation still runs hot, but now there is also growing concern over the health of the economy in general. A government shutdown is still a growing risk after the House of Representatives failed to pass a continuing resolution last week. The House and Senate will reconvene on Tuesday this week to make more attempts at passing funding bills before various public services would be suspended on October 1st. Ships left the Black Sea with grain from Ukraine last week, despite the export deal with Russia no longer being active, and more cargo vessels were reportedly heading for Ukraine's ports to be loaded out this week. Ukraine's navy has established a security detail, but the ships are still vulnerable to being targeted by Russia. Further retaliation remains likely after Ukraine carried out a missile attack on Russia's naval ...

Grain Exports Have to Improve From Here   Export demand has to pick up considerably from here if grain prices are going to have a chance at finding their seasonal lows anytime soon. This week featured another widely disappointing export sales report with new commitments for corn, soybeans, and wheat all near the bottom end of expectations.  Looking at the factors for why exports have been so sluggish, it is also possible to see the reasons for believing that trade demand will flip more bullish over the coming several months.   First, to see just how bad it has been, compare new-crop export sales with where they were at this point a year ago. Even after more than two months of daily export sales announcements popping up regularly, soybean commitments are down 34 percent from a year ago while the USDA's projection for the marketing year pegs them lower by 10 percent. Wheat sales are down 17 percent from last year versus the government forecast for them to drop about 8 percent. Cumulative corn sales are relatively better off being down only 6 percent from last year, but USDA sees corn exports rising 26 percent this year.   The most troubling numbers of comparison are that corn export sales to China are currently less than a fifth of what they were a year ago while soybean sales to China are barely more than half of their year-ago total. China has been purchasing more corn and soybeans from Brazil after record large crops were produced there last ...

SPECIAL HARVEST TIME REQUEST: Thanks to a host of you who have already emailed us yield results with some helpful photos that show what you're describing. We're collecting early yield data in a more systematic and meaningful way than random hearsay. We're asking you to email us early yield results for corn and/or beans to report@commstock.com with the following data points: Your actual yield Your APH yield Whether your yield "met", "fell short" or "beat" your expectations Your county and state As we tabulate results from this voluntary client survey, we'll get a better "feel" for what to expect in USDA's October WASDE. The more of you who participate, the more valuable our survey results may prove! Thank you in advance for participating! (Some telling photographs would also be most welcome! (YOU"LL SEE A SAMPLE IN "OTHER AG HEADLINES AND HOTLINES" BELOW.) SOYBEAN MEAL COVERAGE RECCO DAY 2: Use recent break to hedge 50% of 1st qtr. SBM needs in March '24 futures. On the Grains: Grains are firm in overnight trade as we go to press. Yesterday's action was brutal when it started off with very disappointing export sales. At only 567,000 tonnes, corn sales barely made the low end of expectations that ranged from 550K to 1.1 million. Wheat sales sucked as well, but not quite as bad. At 308K, they at least made the lower end of expectations from 250K to 600K. Soybean sales were worst of all. At only 434K, they didn't even make the low end of expectations ranging from 550K to 1.2 million tonnes. We've noted how drought ...

The debate over CO2 carbon sequestration pipelines includes a re-evaluation of eminent domain law. This is the just of how it works. Some entities plan to build something that requires use of or crossing private property. That can be the state building a highway, city an airport or utility building power lines or pipelines. In the state of Iowa, the entity wishing to acquire an easement must seek a private agreement with the landowner and go through a regulatory process. The companies seeking the easements are required to get as many voluntary easements as possible and then the IUB decides on whether granting them eminent domain power to secure the rest is warranted. There is no statutory number of voluntary easements required but precedent set from the Dakota Access pipeline suggests that 75% of easements must be voluntary to gain IUB approval. The Rock Island powerline only secured 18% voluntary easements and was denied IUB approval. That is the benchmark that we have to work with. Summit Carbon Solutions has near 75% voluntary easements to give them a shot at gaining IUB approval. While that appears to suggest that 25% oppose the pipeline, there is a substantial number of landowners within the holdouts that are just waiting for the best deal. Maybe 10% are "no deal/ no way/not ever."   The Iowa Farm Bureau is a strong private property rights advocate and they enacted a resolution that these projects should acquire 90% of easements voluntarily before approval. Companies know that is a ...

SPECIAL HARVEST TIME REQUEST: We'd like to collect early yield data in a more systematic and meaningful way than random hearsay. We're asking you to email us early yield results for corn and/or beans to report@commstock.com with the following data points: Your actual yield Your APH yield Whether your yield "met", "fell short" or "beat" your expectations Your county and state As we tabulate results from this voluntary client survey, we'll get a better "feel" for what to expect in USDA's October WASDE. The more of you who participate, the more valuable our survey results may prove! Thank you in advance for participating! (Some telling photographs would also be most welcome!) SOYBEAN MEAL COVERAGE RECCO DAY 1: Due to possible bottoming action, hedge 50% of 1st qtr. SBM needs in March '24 futures. On the Grains: Grains are weak in overnight trade with soybeans down hardest. Monthly trade data for August showing China's purchases from Brazil were up 45% while August U.S. sales to China were down by 58% was the "headline" driver, even though U.S. sales to China year-to-date are actually up by 14%. We get a new batch of weekly export sales at 7:30 that could set the tone for morning trade. The range of expectations are as follows: Corn, 550,000 to 1.1 million tonnes, soybeans 550,000 to 1.2 million, wheat 250-600 thousand. Corn fundamentals got a boost yesterday when Brazil's CONAB pegged their 2023-24 corn crop at 119.8 MMT. That's considerably below USDA's estimate of 129 MMT and the International Grains Council concurs, predicting a 4.8% decline in acreage due ...

Typically, trade is one of the issues debated during the presidential primary season here in Iowa but trade, free or otherwise, is not on anyone's front burner this time. Topics to do with "wokeness", which is essentially a backlash from the right against expanding diversity, have been elevated to the status of something significant. The trade issue that does get discussed has more to do with national security rather than commerce. The previous president was highly focused on trade, globally, but mostly focused on China. We are now collecting $Blns in tariffs from China and though a trade deal was made with China, where they were supposed to buy $200 bln in US products, it has never been mentioned in current context let alone gotten enforced. Farmers lost out on what was promised. The agreement intended for China to buy more US purchases but in the end, they have not bought enough to even reach the import levels from prior to the trade war. There was an assumption that China would favor the purchase of US Ag products in order to better balance our trade and that notion was quickly dispelled. Chinese commercial interests buy from where and from whom they get the best deal, making commercial decisions. Instead, they made deals to buy Brazilian corn which they had previously not purchased. We had an assumption that they would buy American for geopolitical reasons and there is a feeling now that the opposite has come true. With the exception of ...

On the Grains: Corn and soybeans are steady in overnight trade while wheat is firm again after yesterday's higher close. We're keeping an eye on basis as harvest picks up momentum and yesterday the national average corn basis slipped but a penny and the soybean basis unchanged. I talked about ethanol margins being the highest since Dec. of '21 on Monday and crush margins for beans are solid as well with the value of a bushel of beans in meal and oil at 16.39 yesterday. The Fed meets today and everybody expects them to hold rates steady, but carefully warning the fight against inflation isn't over and refusing to rule out further hikes if it heats up. That's obligatory caution talk. There are two more Fed meetings this year but a growing consensus expects no further hikes until they begin cutting rates by mid-2024. The crude oil market action feeds into slowing inflation. There's been a steep rally but it ran out of gas (pun intended) yesterday when it collided with weekly chart resistance at last fall's highs. It's also overbought and due for a correction down to the uptrend line, which should hold. Overnight strength in wheat after yesterday's higher close reinforces the view that wheat is trying to confirm the seasonal low is finally behind us. If KC Dec. can take out its Sept 7 high at $7.54 despite a good start for the '24 crop, that low will pretty much be confirmed. On the Hogs: Hog futures put in a strong day with ...

"I know some of you would be like, I get It, but remember we are in the midst of the greatest reindustrialization process in the United States history.  We are building out industrial infrastructure and factories and refineries and pipelines and roads and all that faster than we did during WWII.  There’s a lot of things in play here so let me start with kind of the legacy factors and then we will go into the issues of the now.   1st the legacies.  The United States has the most highly skilled labor force in the world by a significant margin.  There are a few countries like Singapore where the overall education level might be higher but you know Singapore is a country of 5 million people.  The United States is a country of 332 million.  You could say the Germans or the French which might have a little bit more productivity per hour than the United States.  You know we’re talking about a labor force in the United States that is 4 or 5 or 6 times as much and that means that there is not a lot that the US can’t do if it puts its mind to it.  Historically since 1945 and especially since 1991 what the United States has done is focus on the really, really high value added.  We basically shipped all of our underwear manufacturing overseas.  1st to Mexico and then to China and India and instead we designed computers, we designed space stations and we ...

On the Grains: Overnight markets are soft again as harvest picks up steam and basis softens. Yesterday the national average basis for corn and soybeans declined by 3 and 4 cents, respectively. After yesterday's close the weekly crop condition ratings from NASS didn't decline any more than expected Premiums for spot delivery over post-Oct. 1 "new crop" delivery are rapidly disappearing. World leaders are gathering in New York this week, the UN's biggest conclave of the year to discuss issues ranging from collective efforts to thwart climate change to the war in Ukraine. That topic has Ag market implications. Ukraine's President Zelenskyy will address the gathering in person this year rather than remotely, as last year. President Putin of Russia and Xi of China will be conspicuous by their absence. Biden is set to speak this morning with the only guidance on what he'll say from White House National Security advisor Jake Sullivan summed up as "using American leadership to solve the world's problems" without further comment on which problems will be included. Of note, Sullivan also said that "on the sidelines" of the General Assembly, Biden will join the presidents of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan in the first summit of a relatively new group known as the "C5+1". The purpose? Given Russia's assault on Ukraine, these other post-Soviet countries are seeking to "diversify their diplomatic and economic partnerships in the face of Russia’s regional aggression and China’s crackdown on its Muslim minority." Zelenskyy will give his address to the General Assembly ...

Harvest has begun here. The earliest planted corn on light ground was combined to get an early harvest premium at the ethanol plant. The family intends to start the earlage harvest next Monday. I expect there will be an early soybean field missing here soon as well. While cool temps and some moisture may have stabilized the deteriorating soybean condition none of the crops will be adding bushels. My partner says that the top clusters are missing and is worried about small beans. We were expecting 68-73 bpa and now we have revised that lower to 58-63 bpa. When both yield and price go lower the impact on gross revenue is sobering. We think USDA at 50.1 bpa is still too high. Hope that we are too pessimistic but it was an unfavorable end to the growing season that should negatively impact soybeans most. I am binning our soybeans in the hope that sometime the soybean market better reflects reality. We hope that the weak soybean market doesn't know something that we don't. Both corn and soybeans will have extreme yield variability driven by the luck of rain, soil type and planting dates. While my silage appraisal was 261 bpa I will bet you can find 160 bpa corn a few miles away. The late planted corn instead of soybeans was a mistake. There is much better rain in the forecast for the rest of the month but it comes too late to help crops.   September soybeans expired at 1343 ¾ ...

FALL FERTILIZER RECCO DAY 3: The months of down-trending fertilizer prices appear to have bottomed out. Per last Thursday's Weekly Retail Fertilizer Update price fall fertilizer needs now if you haven't already. On the Grains: Corn and soybeans are steady in overnight trade despite early harvest picking up pace through the weekend. Wheat is weaker. Part of the weakness we saw in corn and beans Friday was likely what's termed "pre-hedging pressure" as cash merchandisers take short positions against what they anticipate purchasing from farmers through the weekend and can't risk doing so unhedged. Steady overnight prices thus far shows they adequately anticipated what they bought. The light overnight pressure also shows bears weren't much emboldened by Friday's COT report showing funds added heavily to their net short position in corn. They sold nearly 41,000 more contracts through last Tuesday, taking their net short total to just shy of 135,000. Similarly, funds lightened up their net long position in soybeans by nearly 9,000 contracts yet remained net long just under 74,000. Expectation of traditional "harvest pressure" can be read into the fund action on both counts. We continue to suspect this harvest pressure may prove lighter than anticipated for two reasons. First, we believe actual yields will fall short of expectations and cause many producers to limit deliveries to what they've already priced and that "hedging pressure" has already in the market. Second, particularly for corn, we expect short-bought users to readily absorb new crop. In corn, that's especially likely from the ethanol sector as ...

Grains are expected to open under slight selling pressure as chart support is tested below the market. The large speculators are seemingly wary to be aggressive buyers while harvest progress will be picking up significantly this week. Further upside for wheat could help turn attitudes more positive. In the Headlines ADM announced that had restarted operations at the processing plant in Decatur, Illinois that suffered an explosion last Sunday. The damaged corn mill is one of the largest in the country and has the capacity to produce 375 million gallons of ethanol per year. There still remains some concern that problems with the plant would serve as a pressure on basis just as harvest is set to start and while river markets are nearly shuttered because of low water levels. Ukraine's Eastern European neighbors were preparing to extend their ban on Ukrainian grain imports in a bid to protect against domestic food inflation. Hungary, Romania, Poland, and Slovakia were working on a plan to block grain purchases from Ukraine, but the countries will still help to facilitate shipments that would travel through their land ports on the way to Western Europe and beyond. Russia continues to balk at restarting the Black Sea export deal and the closure of the safe passage corridor has led to lower export volumes from the region. A report from Ukraine's ag ministry showed grain exports in the first two weeks of September down almost 50 percent from last year. Attacks on a grain facility at Ukraine's Odesa port were ...

PLEASE REFER TO THE HEDGE AND TRADE STRATEGY PAGE FOR UPDATES!! Harvest is now upon us and, with the way weather looks, it could be a year where the crop is put away much more quickly than normal. A mostly clear two-week outlook comes as an extension of the dry weather that has rushed crop maturity along. Corn maturity at 34 percent last week was 10 points ahead of last year. At this same point in 2012, corn was called 58 percent mature. Looking back at harvest progress in past years brings up a few points of comparison that may say something about what to expect next. 2012 was the fastest year on record that the corn harvest reached more than two-thirds complete. In most years, 65 percent or more of the harvest has been completed sometime in between the last week of October and the first week of November. In 2012, 69 percent of the harvest had been finished by the first week in October. While this year's drought damage was not as widespread as it was in 2012, dry weather and the rush to maturity will no doubt have had a negative impact on yield outcomes. The silver lining of a smaller, faster harvest can be that the peak of seasonal selling pressure passes sooner than normal. Farmers will be making their sell-or-store decisions quickly and there will be reluctance to let go of ownership if yields are lighter than expected and while prices are so much lower than desired. Buyers ...

FALL FERTILIZER RECCO DAY 2: The months of downtrending fertilizer prices appear to have bottomed out. Per Thursday's Weekly Retail Fertilizer Update we're recommending you price fall fertilizer needs now if you haven't already. SOYBEAN RECCO UPDATE DAY 3: The bearish reaction to Tuesday's WASDE was overdone and expect further declines in yield and ending stocks. That's why we advised lifting hedges the next day. On the Grains: Grains are steady to mixed in low volume overnight trade as we go to press. There's almost a sense of "stalemate" between elements of trading who see impending seasonal harvest pressure favoring patience with short positions and those in our camp who expect early yield results to prove short of expectations and short bought commercials welcoming and readily absorbing new crop deliveries. I'm monitoring cash basis as a good gauge of which view prevails and so far, it's inconclusive. On a national average, cash basis slipped but a penny in corn, wheat and soybeans yesterday. The strong energy market is supportive to demand for both biodiesel and ethanol. Crude oil has moved above $90/barrel for the first time since last November. A growing consensus sees strength persisting as intentional supply reductions from OPEC+ are striking what's called "just enough to keep prices firming, but so much as to curb global demand." NOPA will issue August crush data this morning and it's expected to be down a bit from last month but just short of the record for August. Soybean oil stocks are expected down from both last month ...

I have shared Geopoliticist Peter's Zeihan's concerns over the coming end of China and thought that I would share George Friedman's similar take on the threat.  34 of 50 top Chinese real estate developers have defaulted on debt. Foreign investors are pulling out of Chinese stocks and Chinese capital investment in general. Beijing is no longer rolling over maturing US Treasuries needing the cash back home. Here goes from a transcript: One of the greatest underlying myths of the past years is that of the Chinese economic miracle and it was a miracle, is eternal.  I see China is weakening, becoming less of a force and the People’s Liberation Army as an internal security force.  It’s not going to attack anyone.  This China is not part of China. These factories don’t sell in China.  You can’t sell those products to people who are at a subsistence level agriculture life.  These are extensions of the west.  These factories are part of the American economy, the Australian economy, the European economy, but mostly the American economy.  If the American economy stops buying because we have a recession or we increase our savings rate. Then what happens is that the rate of growth of exports falls and their ability to cover their debts falls.  What you’re seeing in China right now is the government scrambling badly to use what are actually quite limited reserves.  2 trillion dollars isn’t what is used to be.  To simultaneously try to get demand going in the interior of China, which ...

FALL FERTILIZER RECCO DAY 1: The months of down trending fertilizer prices appear to have bottomed out. See the Weekly Retail Fertilizer Update at the end of today's report and see why we're recommending you price fall fertilizer needs now if you haven't already. SOYBEAN RECCO UPDATE DAY 2: Past advice still has you 25% hedged in November futures. We think the bearish reaction to Tuesday's WASDE was overdone and expect further declines in yield and ending stocks. Lift those hedges now and prepare to store beans. On the Grains: Corn and beans are steady to mixed and wheat a little on the soft side in low volume overnight trade. We start with weekly export sales at 7:30. They could set the tone for early trade. Here are the ranges of expectations: Corn – 500,000 to 1.1 million tonnes, soybeans – 600,000 to 1.450 million tonnes, and wheat - 250-600K tonnes. WASDE numbers are now "dialed in" and attention shifts to anecdotal reports of harvest results as they start to come in and a close watch on cash basis to gauge seasonal "harvest pressure." I think it could be lighter than expected. Commercials are short-bought and likely to be ready takers as new crop comes in, while farmers may be reluctant to sell much more than they've already priced, especially if yields prove disappointing vs. prior "field check" estimates. Ethanol data was encouraging yesterday. Production was up while stocks were down, implying solid demand for blending. Weekly EIA fossil fuel data was just the opposite, however. ...

Some people like to read abstracts of farms. I think that they are fascinating. There is a lot of history in them. They used to put in lots of historical details that get omitted today. One of the farms that I farm and is owned by an aunt that was first purchased by my great-great grandfather Frederick Kruse in 1896. That means I am harvesting the families 127th crop from this farm in Clay County Iowa. He was born in Bad Doberan Mecklenburg province Germany in 1832 and immigrated to the US in 1865. I have mentioned that we are friends with a German family from Dresden that we meet with every two years somewhere in the world (Alaska this summer). When in Germany a number of years ago they took us up to Mechlenburg province in NE Germany to a bed and breakfast in the forest. You walk down a path through the woods and suddenly you emerge on the coast looking at spectacular view of the Baltic Sea. I spent a very pleasant day there on the beach. The place was Heiligendamm. It is a German seaside resort founded in 1793. It is the oldest seaside spa in continental Europe. Heiligendamm is part of the town Bad Doberan. I did not find out that my great-great grandfather was born there until after being there.   Iowa became a state in 1846 but it took a while before the western portion of the state was populated. Our 163-acre family farm was ...

On the Grains: Selling subsided overnight after yesterday's unexpectedly bearish reaction to WASDE numbers. Corn and beans are steady to firm and wheat is up again as this goes to press. Corn and soybean yields were lowered pretty much to the average trade estimate, but the drop in corn yield was more than offset by the 800,000 acre boost to planted acreage that actually boosted ending stocks slightly and left their average farm price unchanged at 4.90. What hurt more was the boost to global corn ending stocks. The trade was expecting them to decline about 1.4 million tonnes and instead were boosted by nearly 3 million to 314 million, which exceeded even the highest of pre-report trade guesses.   The break in soybeans yesterday was even harder to figure. USDA dropped the average yield to the average trade estimate so no surprise there. They raised acreage by 100,000 acres and cut both domestic crush and exports some, but still the net result was a 40 million bu. drop in ending stocks just 7 million bu. shy of the average trade estimate for a 47-million bu. reduction. They raised the average farm price forecast from last month by 20 cents per bu. – to $12.90. And unlike the negative surprise by raising global corn stocks, they still cut the global ending stocks for soybeans, just not as much as the trade was expecting by a fraction of a percentage point.  

PLEASE REFER TO THE HEDGE AND TRADE STRATEGY PAGE FOR UPDATES!! The flash drought-like end to the 2023 growing season is squarely focused on the state of Iowa. Gd/ex corn condition fell 3% last week to 46%, which compares quite unfavorably with a year ago when at 63% for Iowa. Gd/ex soybean crop condition ratings fell 5% to 44% last week, which compares to 63% a year ago. 99.8% of IA is in D0-D4 drought. Dry conditions are quickly advancing maturity. 38% of Iowa corn is mature compared to 24% last year. 25% of soybeans were dropping leaves compared to 17% last year. I think it is over 50% here locally. The corn is essentially done and soybeans are filling off whatever subsoil moisture remains accessible in the soil profile. The 6–10-day forecast is for still mostly above normal temps and below normal precip for IA and surrounding region. Rain now mostly keeps the dust down. My concern is that the soybeans are going to dry out quick so combines will have to get there even more quickly before moisture levels drop and BBs shatter. MN is little better than IA with corn condition 39% gd/ex versus 62% last year and soybeans rated 45% versus 65% a year ago. It will be hard for the national yield to soar like an eagle when IA and MN are the turkeys. This was an El Nino year with a below trendline yield. One would not have expected that IA would end the growing ...

On the Grains: Markets are barely steady and leaning soft in overnight trade. Positioning ahead of this morning's highly anticipated crop report and WASDE updates should be complete. We've detailed average trade expectations and the wide ranges for yields, usage and ending stocks in recent reports, but here's a quick rundown of just the most important ones of all: 2023-24 crop ending Stocks. They are the net result of USDA's changes in beginning stocks from last year, acreage tweaks from FSA data, yields from Mother Nature, domestic use from price change or exports from foreign competition. "Bottom line" ending stocks are always the very first line item on the balance sheets that most traders will look at when the reports come out at 11 a.m. Here are the averages and range of ending stocks estimates again: CORN – Average of 2.134 billion bu., down from 2.202 billion last month and ranging from 1.830 billion to 2.399 billion. SOYBEANS – Average of 213 million bu., down from 245 million last month and ranging from 170 million to 270 million. WHEAT – Average of 615 million bu., unchanged from last month but ranging from 586 million to 630 million bushels. After the close, we got updated weekly crop ratings. Corn rated good/excellent was at 52% and down a point from the prior week as expected. It was also a point below last year at this time. Of the top 18 states, 9 showed declines, 6 some improvement and 3 unchanged. Corn rated poor to very poor was unchanged at 18% ...

Nearly Unprecedented Harvest Rush Coming   This may be the year when farmers get really tired of switching back and forth between soybean and corn heads. Both crops may be harvestable at the same time. Two weekends ago a nephew came home from a trip out west to a wedding. He said that he was shocked to see 2 weeks of maturity occur in the 3 days that he was gone. Crops took a real hit from what was the last blast furnace of the summer. He drove by my soybeans to see how soon he would need to get the combine ready and was relieved that ours are still pretty green. I traveled across northern and central IA this weekend and leaves are dropping off soybeans like they were hit by a frost. I saw no corn that would be helped by rain anymore nor would many but the greenest soybeans yet benefit. We are experiencing a materially abbreviated fill period with whatever impact it will have on final yields. Whatever yield that USDA enumerators come up with tomorrow in the September production report, the final yield will be lower. It will take harvest to uncover where yields stand and that should be revealed yet this month as the combines roll. The September report is unpredictable but the on-thrust of harvest is not. It will hit like a derecho. There should be a glut of both corn and soybeans fill the supply pipeline like turning a light switch on when the ...

On the Grains: Overnight action shows corn and beans steady to firm but wheat on the weak side as this goes to press. Weekend rains were minimal. Crop dry-down is only accelerating over two thirds of Midwest corn and beans as they gasped to an early end to their growing season. We'll see weekly export inspections at 10 a.m. that could ripple prices briefly. But for the most part, expect low-volume trade and choppy action as traders nervously finish positioning for tomorrow's WASDE update at 11 a.m. We detailed the unusually wide ranges of trade expectations for both U.S. and global ending stocks last week. Now all that remains is to see where USDA's numbers fall within those ranges. Friday's holiday-delayed weekly export sales weren't bad at all for corn or soybeans. At 949,700 tonnes, corn sales were near the upper end of trade estimates ranging from 400K to 1 million tonnes. Ditto for soybeans. At 1.783 million tonnes, they too were near the upper end of guesstimates ranging from 1.4 million to 2 million tonnes. Soybean meal sales were especially impressive, coming in at 297,000 tonnes and above the 250K top end of estimates. Wheat export sales were barely so-so however. At 370K, they didn't even make the midpoint of the 250-600K range of estimates. In other news of note for wheat, STATS Canada put their wheat stocks 3.58 MMT vs. USDA's estimate at 4.0 million. Heavy rains are said to have damaged the wheat crop in S. Brazil but a godsend ...

Grains are called steady to slightly higher as lower yield ideas lead into the Tuesday crop report. Trading volume has been much lighter than average and will likely remain that way until the report is out. In the Headlines Barged grain movements ground to a halt last week as low Mississippi River levels became an even bigger problem. At about 9.5 feet below the zero stage, water levels at Memphis were approaching the record low reached in October of last year at -10.8 feet. Southbound barge freight rates from the Mid-Mississippi climbed another 9 percent last week. Fresh news was limited from the war in Ukraine, with more Russian drone attacks on Kiev, but no new targeting of Ukraine's grain facilities. The drones were Iranian made, which is notable as reports circulate about Vladimir Putin preparing to meet with North Korean leader Kim Jong Un to discuss North Korea potentially sending weapons and ammunition over to Russia. China was reportedly a buyer of more U.S. soybeans last week, something that could show up in flash sale announcements over the coming few days. Soybean export sales were announced on two of the four business days last week. The USDA reports any grain export sale of more than 100,000 metric tons on a daily basis, with a notice released at 8 am central if there is one. El Nino has been linked to a deadly cyclone and heavy flooding in the Southern Brazil. Last week, nearly 12 inches of rain fell over the state of Rio Grande ...

The shortened holiday week produced a mostly very quiet grain trade and it seemed evident that market participants were just marking time until they could see the outcome of next week's crop report. Speculators were likely only making minor adjustments to their positions and hedgers kept their marketing efforts on hold while preparing for the approaching harvest, so trading volumes were much lighter than normal this week. Take a look at where the different types of traders are positioned heading into the crop report and consider what could change to trigger bigger moves for the market.   The managed money category of traders includes discretionary hedge funds that can choose to be long or short and they can shift positions rather quickly. The two-sided nature of speculators has been on display with a corn position that has flipped from net-long to short and back several times over the last six months. Their indecision came after holding a net-long position in corn for more than two years straight. Now, the funds are net-short corn again by an estimated 87,000 contracts. It should be noted that hedge funds have not turned net-short on soybeans this year, making it nearly three years in a row that they have remained net-long. They were very close to flipping bearish at the end of May, having brought the soybean net-long down to 529 contracts, but the most recent position marked the managed money net-long at almost 91,000 contracts.   Commercial traders – including elevators, mills, exporters, and other end users ...

On the Grains: Grains are steady to mixed in overnight trade after yesterday's latest Drought Monitor map showed drought conditions continue to spread and worsen over much of the country. The holiday-delayed weekly export sales will be out at 7:30 and could well set the tone for early trading. The range of estimates are as follows: Corn, 400K to 1 million tonnes, soybeans 1.4 to 2 million tonnes, wheat 250-600 thousand tonnes. The dominant factor will be continued "positioning" for Tuesday's September crop reports and WASDE updates. The balance sheets for the 2022-23 crop year will have only minor changes. The trade focus will be on the new crop outlook. These are the averages and ranges for key metrics in the 2023-24 season that will move the markets. Let's look at trade yield estimates first for potential changes to the supply side of USDA's new balance sheets: CORN – Avg. yield 173.4 bpa compared to 175.1 in August and 173.3 bpa last year. The estimates range from as low as 171 to as high as 175 bpa. We've made the case in recent days for expecting the number to be closer to the lower end of that range but we might not see it until the October report when harvest results fall short of field check estimates. SOYBEANS – Avg. yield 50.1 bpa compared to 50.9 in August and 49.5 bpa last year. The estimates range from as low as 49 to as high as 51 bpa. Again, we expect the final yield to ...