Written Commentary
CORN
Prices were up $.05 closing near session highs while spreads were little changed. Dec-26 traded and closed above its May high of $5.06 ½ however stopped shy of its contract high at $5.12 ½. Pro Farmer forecasts this year’s crop at only 15.344 bil. bu., 669 mil. bu. below the Aug-26 USDA forecast. Their Ave. yield at 173.2 bpa, if realized would be the lowest in 6 years and well below the USDA 180.7 est. A USDA print this low would likely drive prices above $5.50 bu. The USDA announced a flash sale of 205k mt (8.1 mil. bu.) to an unknown buyer. The BAGE held their Argentine production forecast unchanged at 64 mmt, just above the USDA est. of 63 mmt. Harvest progress reached 81%, well below the historical average in the mid-90’s. Datagro forecasts Brazil’s corn deficit in 2026/27 will grow to 7.2 mmt, from 2.7 mmt in 2025/26 due to expanded usage for ethanol production. This afternoon’s COF showed inventories in feedlots as of Aug. 1st at 11.117 mil. head, up 2% from YA and slightly below expectations. Placements at only 89% of YA were below expectations of 93.5% while marketings at 93% were in line with expectations.
SOYBEANS
Prices were mixed with beans $.02-$.04 higher, meal was up $2 while oil sold off nearly $.02 lb. Sept-26 and Nov-26 beans shrugged off early weakness to close near session highs. Sept-26 meal rejected trade below its 100-day MA. Sept-26 oil closed back below its 50 and 100-day MA’s. Crush margins plunged $.20 to $2.36 ½ bu., closing at a 5-month low. Bean oil PV dipped to 52.2%. The USDA announced large flash sales of 720k mt (26.4 mil. bu.) to an unknown buyer and 712k mt (26 mil. bu.) to China. US Gulf FOB offers are $.35-$.50 bu. below Brazilian offers thru the end of 2026. Crush margins are under pressure as markets attempt to ration demand as China continues to stack up US soybean purchases. IMO the US balance sheet has little wiggle room for US yields to slip from the current USDA est. of 52.7 bpa or risk sharply tighter stocks. The Pro Farmer production forecast will likely be viewed as bearish as they forecast production at 4.572 bil. bu. 53 mil. bu. above the USDA est. Their yield forecast at 53.3 bpa would be a new record high compared to the USDA est. of 52.7 bpa. China’s COFCO expects Brazilian soybean acres will increase slightly in the 2026/27 growing season however yields and production may be lower due to El Nino. EPA data showed D4 RIN generation in July slipped 5.2% to 795.5 mil. suggesting a pullback in biodiesel and RD production.
WHEAT
Prices ranged from $.01-$.06 lower across the 3 classes in 2-sided trade. CGO Sept-26 was down $.01 ¼ at $6.81 ½, KC Sept-26 was $.06 lower at $7.56 ¼ while spot MIAX is off $.02 ½ at $6.98 ¼. The BAGE held Argentine acres unchanged at 6.5 mil. HA while plantings are essentially wrapped up. So far the logistical issues in the Black Sea haven’t led to higher demand for US wheat with exports down 32% from YA vs. the USDA forecast of down 15%. US durum acres in drought plunged 14% LW to 53%. SovEcon lowered their Russian grain production forecast 2.7 mmt to 132.6 mmt, of which wheat production at 88.2 mmt was down .3 mmt, in line with the USDA est. of 88.5 mmt. Ukraine’s grain exports Aug. 1st-21st at 540k mt are well below the 1.73 mmt shipped same period YA.
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