Prices Across Ag Space Little Changed

MORNING AG OUTLOOK

Prices across the agricultural space are little change in 2-sided trade overnight. Energy prices have firmed as US Central Command has executed military strikes on Iranian targets for a 6th consecutive evening.  Iran claims to have targeted US forces in Syria and Bahrain as they widen their attacks in the Middle East.  Spot WTI crude oil is up $2.00 near $81 per barrel closing in on this week’s high of $81.27.  Spot RBOB is up $.05 per gallon while HO is $.06 higher.  War in the Black Sea rages on as Ukraine forces claim to have struck 12 ships in Russia’s “shadow fleet” in the Black Sea overnight.  In the past 11 days they have hit 159 Russian vessels in the Sea of Azov and Black Sea.  Russian forces continued attacks on Ukrainian port infrastructure in Odesa and Chornomorsk.  The Trump Administration is using Section 301 of the Trade Act of 1974 to impose 25% tariffs on imports from Brazil.  Exemptions include beef, coffee, rare earth and energy products along with aircraft and aircraft parts.  Tariffs will apply to ethanol and sugar.  Much above normal temperatures are expected to ease across the central Midwest and ECB by the end of this weekend.  Normal to below normal by the middle of next week.  Temperatures across the WCB and plain states expected to remain normal to above much of next week with little to no precipitation.  Recent rains in France bought modest relief before returning to a hot/dry pattern.  Seasonably warm in SA while heavy rain in RGDS may delay 2nd corn harvest.  The US $$ is slightly higher while US stock indices are down .50%-1.60%.

Corn: 

Sept-26 and Dec-26 are both $.01 lower at $4.40 ½ and $4.63 respectively while holding within this week range.  With 100+ degree heat this week limited to the northern and SW Plains, perhaps the market senses its impact on the corn crop may be limited.  Lack of rain for the WCB is still problematic.  Despite weak export sales this week, YTD commitments are up 25% YOY vs. the USDA forecast of up 16%.    Pace analysis would suggest the USDA export forecast at 3.325 bil is still at least 25-50 mil. bu. too low.  The BAGE kept their Argentine production forecast unchanged at 64 mmt vs. the USDA est. of 63 mmt.  Harvest has reached 62%, well below YA pace of 80%.  France’s Ag Ministry reports corn ratings fell another 6% to only 41% G/E.

Soybeans: 

Aug-26 beans are up $.02 ½ at $11.97 ½ while Nov-26 is $.01 ½ higher at $11.96 ½.  Both held just below the $12 level.  Aug-26 meal is down $1.40 at $321.50 while Aug-26 oil has surged 124 points to 73.67 reaching a 5-week high.  Crush margins jumped another $.08 to $3.20.  EPA data showed D4 RIN’s generated in June reached 839 mil. up 14% from May suggesting a surge in bio and renewable diesel production, and likely surge in soybean oil usage.  This was the highest D4 RIN generation since Dec-24.  Markets remain sensitive to China demand interest, or lack thereof.  US Gulf FOB offers hold $.05-$.20 over Brazilian offers thru Nov. despite no flash sale announcements since Monday.  Argentine farmers have priced only 28% of this year’s crop, well below the historical average of 35% by mid-July.

Wheat: 

Prices range from $.01-$.06 higher across all 3 classes shrugging off early weakness.  CGO Sept-26 is up $.02 at $6.93.  KC Sept-26 is $.03 ¼ higher at $6.88 ½ while MIAX Sept is up $.03 at $6.88 ¼.  Supply disruptions from the world’s largest exporter of wheat coupled with lower production in the US and EU will likely keep the path of least resistance higher with volatility elevated.  After modest selling yesterday, we’ve got speculative traders still short 33k contracts in CGO futures (SRW).  The BAGE reports Argentine plantings have reached 92%.

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