Daily Ag Direction 8/8/24
Good Morning!
Wheat is seeing some weakness this morning, although staying afloat compared to recent price activity. We need a really good fundamental reason to move higher from this point and that may come from civil unrest in the world or another black swan type event, but those things are unknown to us at this time. Outside of that there is little growing or production concerns at the moment. Global demand is not offering the support many hope for and will be required to drive prices higher. Wheat that is moving seems to come from cash flow needs rather than excitement about where prices will move in the future. Weekly export sales totaled 274k tons which backs up the poor global demand argument. Estimates ranged from 250-500k tons. Matif futures did see some strength on production issues locally with European wheat production lowering by 5.8 mmt. Corn exports of old crop came in at 485k mt and 249k mt of new crop. Old crop was above trade guesses but new crop lagged estimates by at least 225k mt. Looking ahead to the WASDE report on Monday trade expects USDA to make changes to yield increasing to 182.1 bu./acre. The estimate range is 180.1-184 bu./acre. Carryout is estimated at 2.096 billion bu. rivaling 2018/19’s carryout number. The expectation is that flooded acres will not be as big of a concern as previously thought so increases in yield will most likely outweigh a reduction in acres. Soybeans do not have a weather concern to support prices. Some export sales to China are supportive. We need to see more demand to outweigh production hurdles. Any South American risk would be supportive.
Sept ’24 KC Wheat -4.4 @ $5.51
July ’25 KC Wheat -4.6 @ $5.95
Sept Corn +1.4 @ $3.85
Dec Corn +1.4 @ $4.02
Aug Beans +3.0 @ $10.23
Nov Beans -7.0 @ $10.12
Sept Feeders +0.100 @ $239.000
Oct. Live -0.450 @ $178.825
Please reach out to your CEA Risk Management Advisor if you have any questions. Have a great day!