News Source: SETZ

Morning Comments; Tuesday, September 18th, 2018

Grains are trading mixed on the overnight session.

Crop ratings after the close yesterday held no surprises. As crop conditions are less important as we approach harvest, it should have little effect on the trade. Corn maturity continues to run almost 20% ahead of last year and nearly 10% ahead on denting. As with corn, soybeans are about 15% ahead dropping leaves than a year ago. Harvest pace for both corn and soybeans is at 9% and 6% respectively and only slightly ahead of a year ago.

A university study recently showed that ethanol waivers granted to smaller oil producers has not led to demand destruction that the ethanol industry has voiced concern about for some time. Ethanol production has not been hampered by anything the EPA has mandated, but more so how they have enforced the mandates. Ethanol plants are not concerned about demand levels and ethanol usage, but rather the profitability of production over plant capacities. Three plants announced yesterday that they will idle production capacity.

The US/China situation continues to remain at a stalemate. The US has indicated they will issue another round of tariffs over $200 billon of imports. China has indicated they will remove themselves from negotiations if the US proceeds.

Market movers: Trade negotiations, weather forecasts and yield updates.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments: September 17, 2018

The grain market is struggling today with very little fresh news. The ongoing trade conflict with China is expected to escalate early this week with the Trump Administration threatening tariffs on an additional $200 billion worth of goods, which has China threatening to pull out of proposed talks.

NOPA reported a record August crush this morning of 158.8 MBU versus the higher 163.5 average estimate. Soy oil inventories at the end of August were 1.623 billion pounds versus the average estimate of 1.751 billion. At the end of July, the crush was 137.73 MBU with soy oil reserves at 1.764 billion pounds. One bright spot this morning came from the USDA announcing a solid export sale of soybeans. 241,000 MT were sold to an unknown destination for 2018/19.

The weekly crop progress report out later today is expected to show steady conditions on corn and beans with maturity and harvest ahead of normal.

December corn closed down 3 cents at $3.48, November soybeans closed down 7 cents at $8.23 , and December Chicago wheat closed down 5 cents at $5.06 .

Morning Comments; Monday, September 17th, 2018

Grains are trading mixed on the overnight session.

The trade seems to be content with futures price levels after the USDA report last Wednesday. As more attention of the producer shifts towards harvest, traders are digesting early yield reports. Early yield reports have been variable for corn, but seem to be on the higher side for soybeans as the trade has been suspecting thus far.

African swine fever continues to spread in China. It has been in Eastern Europe for 4 years as it migrated west from Russia. The disease was though to make its way to Germany in 4 years, but now has popped up in Belgium. The U.S. is watching the spread of the disease and how it is transferred to avoid exposing the U.S. Lean hog futures have rebounded sharply recently as the trade is becoming more concerned about world pork production.

National Oilseed Processors will issue their August crushing report on Monday. Estimates are at 163.9 million bushels, up 21 million bushels from a year ago. Soybean crushers have been experiencing strong margins, which is helping utilize more than ample soybean stocks.

Market movers: Trade negotiations, weather forecasts and yield updates.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Weekly Review; Friday, September 14th, 2018

USDA Calls a Record Crop

Seven of the eleven large Midwest corn producing states are forecasting record corn yields after yesterday’s USDA’s report, catching many traders off-guard. Among many, but particularly the state of Illinois, updated report data showed the state is expected to see a record large yield of 214 bushels per acre, 13 bpa higher than their previous record. According to data from FC Stone, their crop is maturing 27% ahead of average for this same week. Their data also shows South Dakota with a new record yield, and 19% ahead of average maturity. Strangely, during the second week in May South Dakota was 46% behind average planting pace, leaving many questioning the record ear weights published by the USDA.

The USDA has released the methods used to determine how the payments were calculated for the trade relief program. The agency used standard market facilitation models to estimate the impacts of the trade tariffs. The models simulated the expected reduction in US exports due to the tariffs. Their report states that if necessary, in December, a second payment could be issued using the same approach with the market facilitation models.

US & China are planning to meet for another round of trade talks. It’s stated that the talks are going to be held with higher-level officials compared to the attendees in the August meeting. A more optimistic tone is surrounding these meetings. Stock markets have rallied as of recent with hopes that the US-SINO will make progress in the days ahead.

China continues to try and source their soybean needs from other sources than the US. According to data from Advance Trading Inc, it was reported that last week, China purchased 10-12 cargoes of October/November soybeans from Brazil, 4 cargoes from Argentina, and 3 from Canada. It has also been reported that China is currently working on a deal to import more soybean meal from India. They are said to be meeting with officials September 19th to see if they can get an agreement in place.

Canada also appears to be ready to offer the U.S. limited access to Canada’s dairy markets in an attempt to secure a NAFTA agreement. Energy markets are weaker as Hurricane Florence has been downgraded to a category 1 with landfall either expected late today or early tomorrow on the coast of the Carolina’s.

Due to technical difficulties the weekly crop progress and condition rating report was released a day later instead of Monday.Despite trades expectations and seasonal tendencies, corn and soybean condition ratings both increased in the release and both stand at 68% good to excellent. The maturity of both the corn and soybean crops remain well above last years crops and the average for this date. This week’s report also showed the first harvest progress for corn at 5% that is above the average for this date of 3% but equal to last year’s pace.

Corn and soybeans struggled all week with very little fresh news after the USDA released their surprisingly big yield numbers on corn and soybeans yesterday. The USDA reported a private export sale of 142,876 MT of 18/19 corn to Costa Rica this morning. 108,010 MT of soybeans were sold to Mexico for 18/19 and other sales of 40,000 MT for 18/19 and 80,000 MT for 19/20 were sold to an unknown destination.

Meteorologists have predicted that Hurricane Florence to continue its storm surge throughout the weekend and into next week. It is estimated that there are 870,000 corn acres in North Carolina and 310,000 corn acres in South Carolina, representing roughly 150 million bushels of corn. While not a large amount, trade will be monitoring the situation as US corn demand remains solid and further reductions to carryout could warrant fund buying. There are also an estimated 100 million bushels of soybeans grown in that region, ample soybean stocks have traders less concerned about damage to the crop.

Brazilian farmers are seeking support to develop a futures contract to ease deals between Brazil & the top importer of beans China. Many bankers, growers, analyst & economists are saying this would make sense to establish a contract to hedge growing risks due to the price differences between US soybeans & Brazil’s soybeans. A new contract would provide an alternative to the CBOT that dominates the global market of soybean pricing.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Friday, September 14th, 2018

Corn and beans are steady to higher on the overnight trade.

The USDA released the methods used to determine how the payments were calculated for the trade relief program. The agency used standard market facilitation models to estimate the impacts of the trade tariffs. The models simulated the expected reduction in US exports due to the tariffs. Their report states that if necessary, in December, a second payment could be issued using the same approach with the market facilitation models.

US & China are planning to meet for another round of trade talks. It’s stated that the talks are going to be held with higher-level officials compared to the attendees in the August meeting. A more optimistic tone is surrounding these meetings.

Market movers: US/China talks, weather developments, and yield reports

For more information, you may contact Kristi Guse at (712)-260-6486, or e-mail at kguse@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Kristi Guse. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments: Thursday, September 13, 2018

Stock markets have rallied today on hopes that the U.S. and China may enter new trade talks to prevent trade tensions from escalating. Canada also appears to be ready to offer the U.S. limited access to Canada’s dairy markets in an attempt to secure a NAFTA agreement. Energy markets are weaker today as Hurricane Florence has been downgraded to a category 2 with landfall expected either late today or early tomorrow on the coast of the Carolina’s.

Corn and soybeans struggled today with little fresh news after the USDA released their surprisingly big yield numbers on corn and soybeans yesterday. The USDA reported a private export sale of 142,876 MT of 18/19 corn to Costa Rica this morning. 108,010 MT of soybeans were sold to Mexico for 18/19 and other sales of 40,000 MT for 18/19 and 80,000 MT for 19/20 were sold to an unknown destination.

September corn futures closed down 5 cents at $3.36 1/4 while December closed down 2 cents at $3.50 1/2. November soybeans closed down 6 cents at $8.33 1/4.

Morning Comments; Thursday, September 13th, 2018

Corn is steady to higher, while soybeans are under pressure.

Seven of the eleven large Midwest corn producing states are forecasting record corn yields after yesterday’s USDA’s report, catching many traders off-guard. Among many, but particularly the state of Illinois, updated report data showed the state is expected to see a record large yield of 214 bushels per acre, 13 bpa higher than their previous record. According to data from FC Stone, their crop is maturing 27% ahead of average for this same week. Their data also shows South Dakota with a new record yield, and 19% ahead of average maturity. Strangely, during the second week in May South Dakota was 46% behind average planting pace, leaving many questioning the record ear weights published by the USDA.

China continues to try and source their soybean needs from other sources than the US. According to data from Advance Trading Inc, it was reported that last week, China purchased 10-12 cargoes of October/November soybeans from Brazil, 4 cargoes from Argentina, and 3 from Canada. It has also been reported that China is currently working on a deal to import more soybean meal from India. They are said to be meeting with officials September 19th to see if they can get an agreement in place.

China’s Ag Ministry yesterday decreased their soybean import forecast for next year. They are expecting a decrease of 10.2 MMT at 83.7 compared to last month’s figure of 93.9 MMT. The promotion of lower protein livestock and poultry feeds are noted for the reduction. The USDA has them down for importing 94 MMT down 1 MMT from last month.

Market Movers: continued reactions from report data, fund activity, export sales.

Closing Comments; Wednesday, September 12th, 2018

The USDA has absolutely shocked the grain complex with today’s release of the September WASDE. Today’s release marks a new all-time record for corn coming in at 181.3 BPA. This would be an increase of 2.9 BPA from their August WASDE. Their anticipated soybean yield came in at 52.8 BPA, upping their previous estimate by 1.2 BPA. The correlation between late August weather and soybean production lead many to believe we could potentially see more increases down the road.

A new record of implied ear weights have many scratching their heads when you factor in the weather timeframe and extremely fast pace of this crop maturing. The later maturity stages of the crop were largely taking place under less than ideal conditions. Many believe that an increasing pace of better genetics available to the marketplace can be attributed to this.

All things considered, even with the record yield projections, total corn usage has broken the 15 billion bushel barrier for the first time. This steady demand base has created a solid foundation for future balance sheets.

September corn finished the day down 13 cents at $3.41 . November Soybeans closed up 8 cents at $8.40. September Chicago Wheat finished the day down 15 cents at $4.78 .

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Wednesday, September 12, 2018

Corn and soybeans are weaker this morning.

The main story in today’s session will likely be the release of the USDA’s supply and demand report. Much of the focus will be on what is published for this upcoming years corn yield, the average trade guess is for 177.8 bushels per acre. Trade is expecting to see production at 14.53 billion bushels. This upcoming years carryout estimate is expected to be around 1.64 billion bushels.

The average trade guess expected for the soybean yield is 52.2 bushels per acre. Up a half a bushel from last month. Production is estimated at a record 4.65 billion bushels. Carryout for 2018/2019 is expected to be a very large 830 million bushels, up 45 million bushels from last month and nearly double this years estimated carryout.

The firm CONAB released their upcoming production figures for Brazil yesterday. They lowered their estimated corn production to 81.4 MMT down from 82.2 MMT last month. They slightly increased their soybean estimate to 119.3 MMT. The USDA’s latest figures for Brazil’s corn production is at 83 MMT and soybean production at 119.5 MMT, nearly equal to CONAB. The USDA will also update their expected world figures in today’s release.

Market movers: USDA report data, weather developments, and ethanol manufacturing

Closing Comments; Tuesday, September 11th, 2018

Soybeans lead the decline today but corn and wheat were also under pressure much of the session. Very little fresh news circulating and funds unwillingness to buy ahead of tomorrow’s report hindered values.

Due to technical difficulties the weekly crop progress and condition rating report was released today instead of Monday. Despite trades expectations and seasonal tendencies, corn and soybean condition ratings both increased in the release and both stand at 68% good to excellent. The maturity of both the corn and soybean crops remain well above last years crops and the average for this date. This week’s report also showed the first harvest progress for corn at 5% which is above the average for this date of 3% but equal to last years pace.

Meteorologists are predicting hurricane Florence to hit the Carolina’s at the end of the week. It is estimated that there are 870,000 corn acres in North Carolina and 310,000 corn acres in South Carolina, representing roughly 150 million bushels of corn. While not a large amount, trade will be monitoring the situation as US corn demand remains solid and further reductions to carryout could warrant fund buying. There are also an estimated 100 million bushels of soybeans grown in that region, ample soybean stocks have traders less concerned about damage to the crop.

December corn futures finished today’s session down cent at $3.66 , November soybeans fell 13 cents to close at $8.31 , and December Chicago wheat closed 9 cents lower at $5.18 .

Closing Comments; Monday, September 10th, 2018

Brazilian farmers are seeking support to develop a futures contract to ease deals between Brazil & the top importer of beans China. Many bankers, growers, analyst & economists are saying this would make sense to establish a contract to hedge growing risks due to the price differences between US soybeans & Brazil’s soybeans. A new contract would provide an alternative to the CBOT that dominates the global market of soybean pricing.

Weekly export inspections were released this morning. Corn was reported at 763,475 metric tons which is lower than last week however it’s 85,536 tons higher than this time last year. Early year inspections on corn are 658,501 tons compared to 677,939 tons last year. Soybeans were reported at 924,839 tons which is more than last week however it’s 182,262 tons less than a year ago. Early year inspections on soybeans are 832,152 tons compared to 1,107,101 tons last year.

December corn closed the day up at $3.67 . November soybeans closed the day up 1 at $8.45 . September Chicago Wheat closed the day up 17 at $5.04.

For more information, you may contact Kristi Guse at (712)-260-6486, or e-mail at kguse@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Kristi Guse. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Thursday, September 6th, 2018

Today Informa released their September yield estimates. They have corn yield with a slight increase at 178.8 bpa versus the USDA’s 178.4. As expected they increased their soybean yield to 52.9 bpa. This would be an increase of 1.3 bpa over the USDA’s estimate. Compared to last year’s total crop production, this translates to an increase of a 17 million bushel increase for corn and a 306 million bushel increase for soybeans.

Decreased Chinese soy consumption is expected to continue throughout the year. Alternatives to soybean meal are now being used as the price differential has swung in their favor. The increased availability of DDGs along with the idea of lower feed consumption mainly due to African swine fever in Chinese herds could potentially soften the demand of soybean meal buyers.

Elevated exports of US soybean meal can be directly attributed to Argentina’s short crop in 2017. Many analyst believe the increased demand of US meal will fall back to traditional levels with the condition of a normal Argentina growing season. Arguably, US crush plants have been seeing record margins over the past year from this export demand.

September Corn finished the day up 1 cents at $3.53 . November Soybeans were up 1 cents at $8.39. September Chicago Wheat down 7 cents at $4.86.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Wednesday, September 5th, 2018

Grains are trading higher on the overnight session.

Chinese soy demand continues to look bleak into 2019 according to a report from a large Chinese processor. The Jiusan Group bought nearly 60% of the US soybean exports last year, but has been absent from the market since tariffs went into effect on July 6th. China has indicated plans to replace US soybean imports with imports from Brazil. However, sources indicate that China could run out of soybeans in early 2019. Chinese traders fear this could inflate soybean meals prices as beans become scarce and will force them to source alternate protein meal supplies.

The July soybean crush report indicated a strong month at 178.9 million bushels, 23 million bushels higher than a year ago. As expected, soybean meal stocks have increased from a drop in exports. Despite a less than anticipated 12% drop in meal exports, meal usage actually increase by over 2% from last year, thanks to a 9% domestic usage increase. Similar to meal, oil stocks are up compared to a year ago. Soybean oil exports are down 8%, but thanks again to domestic usage, overall usage is 6.5% higher than last year.

Both corn and soybeans gained from negative monetary news out of Argentina over the weekend. A supplemental or emergency export tax on grain of 10.5% helps spur fund buying in the later part of the session Monday, mainly in corn futures. This tax is thought push the Argentinian producer away from corn and towards soybeans.

Market movers: Trade negotiations, weather forecasts and yield updates.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments, Tuesday, September 4th, 2018

Chicago wheat futures were under pressure for most of the overnight and today’s session. The Russian government issued a statement indicating they were not going to limit wheat exports or raise the export tariff in any way. Early reports in July indicated that at one time the Russian Ministry of Agriculture was considering curbing exports once they reached 30 million tons.

Elevated precipitation amounts in the Corn Belt have many believing we could see the effects from mid-season plant disease. Many agronomists in these areas have commented that with the increased rainfall and humid conditions, we could see kernel quality quickly deteriorate. Several have commented that we could see lighter test weight corn because of the speed at which this crop matured.

The COT’s report has pulled the managed money short in corn to roughly 60k contracts, with 18k contracts covered from last Friday’s rally. While total managed money short in soybeans came in at 53k, 20k greater than expected. Total long in Chicago Spring wheat came in at just under 50k contracts.

September corn finished the day up 3 cents at $3.54 . November soybeans closed the day cents at $8.44 . September Chicago Wheat closed down 16 cents at $5.02 .

Closing Comments; Friday, August 31st, 2018

FCStone released their September crop survey yesterday. For corn, they posted a 177.7 BPA which is 1 bushel below USDA’s 178.4 BPA, and a 0.4 BPA decrease from their August Estimate. For soybeans, as expected, they increased their soybean yield to 53.8 BPA. This would be a 2.3 BPA increase from their August survey and a 2.2 BPA increase over the USDA August estimate.

Ethanol futures are trading at their lowest point since the introduction of the contract in 2005. Plant margins have in turn been above if not right at breakeven while there have been no reports of plants slowing down or shutting down for that matter as we move forward. Firming DDG values have pulled margins slightly higher in the past week alone.

Today’s trade saw a decent amount of short covering from the funds. Month end and a long holiday weekend was simply the driving force behind this. The forecast for next week includes precipitation nearly every day for a very large portion of the grain belt. Many of these areas are within a couple days of fieldwork starting. This will push funds to be even more defensive with their positions moving forward.

September corn finished the day up 10 cents at $3.51 . November beans closed 13 cents higher at $8.48 . September Chicago Wheat closed 11 cents higher at $5.19.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Closing Comments; Thursday, August 30th, 2018

Developing outside forces continue to plague the US soybean farmer. China continues to displace soybean imports with lesser-used alternatives such as sunflowers, cottonseed meal, and rapeseed meal. Officials in the country say they can displace roughly 10 million metric tons using these products. Although the exact number is obscure, China may be forced to use some of their state reserves. This is a very good possibility since there is not enough importable soybeans outside the US to satisfy China’s appetite.

The president of Argentina recently asked the IMF to speed up their $50 billion bailout package. This in turn caused the peso to crash and continue for two straight days. This morning, Argentina’s central bank increased lending rates by 15% to 60% in order to stymie the crashing peso. Shockwave’s were felt throughout the world as currencies tumbled on this news.

President Trump has said he is optimistic about a trade agreement with Canada. Sources close to the matter say that Canada is closing in on an agreement, and have expressed that they will have a deal done by Friday’s deadline. Canada’s inclusion on this trade package is paramount for individual states when one considers that 35 states of the 50 United States have Canada as their largest export market for both agriculture and general goods.

September corn finished down cents at 3.40 . November Soybeans closed down 3 cents at $8.31 . September Chicago Wheat finished down 7 cents at $5.08.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Thursday, August 30th, 2018

Grains are trading higher on the overnight session.

US Ethanol production is a strong point for US corn demand. While corn usage was down slightly for last week, weekly consumption remains around 110 million bushels or 5.74 billion annually. Ethanol production is up about 3% year to date, but the price of corn has kept plants profitable at thin margins.

No news continues to be the theme on any trade negotiations on the Chinese tariff issue. This is discouraging as this is typically the period when South American supplies run low and China turns to the US to secure soybean needs. The lack of an export program to China, coupled with ongoing issues with African Swine Fever and efforts by China to use alternate protein sources is pushing thoughts of US soybean carryout even higher.

A Chinese delegation of soybean buyers has been in the US this week visiting with soybean groups. This is a period when buyers typically work out and sign purchase agreements. That action is on hold because of tariff issues. But buyers have said they want continue business relationships and be ready to resume purchases of US soybeans once the trade issues have been resolved. The US has invested over 100 million dollars in market development in the past 30 years.

Market movers: Reaction to trade negotiations

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Wednesday, August 29th, 2018

US economic growth was stronger again for the second quarter. On an annualized basis, gross domestic product will exceed the 4.1% July estimate, slightly higher at 4.2%. The Commerce Department commented this was fastest pace of expansion since the third quarter of 2014. Many analyst contribute this robust growth in GDP to the 1.5 trillion-tax cut package. Conversely, the housing market is showing signs of slowing down as reports of homebuilding growth is less than anticipated while new and used home sales are also following suit.

The new US-Mexico trade accord could potentially face a few hurdles before ratification. Approval from Congress is just one of the barriers. Although very unlikely, the political risk is that of the Republican controlled house which could table this trade package for 90 days. The perception of a trade deal progressing will be critical as we move deeper into harvest.

First notice day for September futures is this Friday, August 31st. Next week follows is shortened schedule with the Ag Markets closed Sunday evening and Monday for Labor Day. Monday’s overnight session will continue as usual.

September corn finished the day up cents at $3.41 . November soybeans closed up 2 cents at $8.36. September Chicago Wheat finished the day up 17 cents at $5.15 .

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Wednesday, August 29th, 2018

Grains are trading mixed on the overnight session.

The longer the lack of a resolution with the Chinese trade issues continues the more pressure the soybean complex seems to endure. The last USDA supply and demand estimate posted a record 785 million carryout. With ample late season rainfall and a small uptick in condition ratings has traders thinking thoughts of generally higher soybean yield prospects. Soybean carryout projections now in the 900 million range have been suggested. A lack of a strong Chinese export program and growing world soybean stocks seems to have the markets attention in the short term.

Ending stocks for corn are also getting some pressure from thoughts of a yield bump on the September USDA estimate. It has long been thought that there is little correlation between ratings and final yield. Looking back to last year, ratings are 6 % better in the good/excellent column and the final yield was 176.6 bu/acre. The current USDA yield estimate is 178.4 bu/acre. Not only are higher yield possibilities weighing on corn, the general negative tone in the soybean complex is keeping pressure on corn futures.

Corn commodity groups were disappointed by the small amount of tariff aid proposed this week by the USDA. Ethanol groups are pushing for approval of the sale of E15 year around at the pump. No action has been made to make such a move from the EPA.

Market movers: Reaction to trade negotiations

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Tuesday, August 28th, 2018

Analyst continue to revise their original soybean carryout estimates upward. The possibility of a 1 billion bushel carryout is not out of the cards. Favorable August rains usually tends to bode well for soybean production to a certain degree. DP and storage rates have been the buzz lately out in the country while conversations are starting to take place whether storage rates are reflecting true market value.

Crop ratings reveal the crop maturing at a faster pace than originally thought. Corn dented is showing 61% complete compared to the 5 year average of 42%. Corn in the matured category shows 10% in comparison to the 5-year average of 5%. One stat of interest is the total corn dented between the two biggest corn-growing states, Iowa and Illinois. So far, Iowa is currently ahead of its corn dent average by 30% and Illinois by 27%.

Strength in the livestock markets was evident from yesterday’s trade agreement between the United States and Mexico with lean hogs the definitive leader. Most believe that pork exports to Mexico could prove beneficial as early as this fall. Mexican tariffs on US pork in June caused supplies in cold storage warehouses to swell amid record expansion in the industry.

September corn finished the day down 5 cents at $3.41. November soybeans closed 14 cents at $8.33 . September Chicago Wheat finished down cents at $4.98 .

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Tuesday, August 28th, 2018

Grains are trading mixed on the overnight session.

Crop ratings released Monday afternoon with no change to corn at 68% good to excellent and a 1-point improvement for soybeans at 66% good to excellent. This was not surprising as much of the Corn Belt saw beneficial rains last week. As with the previous week and as noted on the ProFarmer tour, the corn crop remains about a week ahead of schedule in the dough, dent and mature stages. Soybeans are also ahead on maturity, but not nearly as much as corn.

China and US trade negotiations seemed to have stalled after 3 days of negotiations. It was reported last week that China quietly removed US crude oil from its retaliatory tariff list. They are expected to resume importing US crude in October. This news has offered hope for the Ag sector but many feel a solid resolution is unlikely in the near future. While not confirmed, sourced indicate China will be reluctant to make any progress before the mid-term elections.

After the close Monday, Secretary of Agriculture Sonny Perdue announced some preliminary details on the tariff aid package. As expected, it is heavily weighted towards soybeans. There are payment caps at $125,000 and payments will be based on 50% on the 2018 production. Other commodities on the higher end of the payments were sorghum at 86 cents per bushels and hogs at $8 per head.

Market movers: Reaction to trade negotiations

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Monday, August 27th, 2018

According to Reuters, a Romanian farm roughly 1,300 miles away from China has contracted the African swine fever. This farm holds roughly 140,000 pigs and is the country’s largest breeding farm. The speed at which this virus has spread, has baffled state governments, and swine trade associations. Countries have now stated they will increase disinfection and quarantine checks at high traffic areas along their borders. Business officials and local governments will continue to increase their bio security requirements in an effort to halt this deadly virus.

US and Mexico have reached a preliminary trade deal as of today. The new trade agreement would be called the United States-Mexico Trade Agreement, while completely discarding the NAFTA name. The biggest changes of the agreement have favored the automobile sector requiring that a certain percentage of each car to be assembled with parts from either country. Pressure is mounting on Canada to come to the table. All three countries have been quoted that a trilateral agreement would be ideal for all countries involved.

Agriculture Secretary Sonny Perdue is expected to address the farm aid package today that will be disbursed to farmers hurt by trade wars with China. Sources close to the matter estimate that anywhere from 8-9 billion dollars of the total 12 billion will be in the form of direct payments. Perdue also mentioned that the remainder of the 12 billion will go government purchases and trade promotion overseas.

September corn finished the day down 1 cents at $3.46 . November soybeans were down 7 cents at $8.48 . September Chicago wheat was down 13 cents at $5.01.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Commnets; Monday, August 27th, 2018

Grains are trading lower on the overnight session.

Last weeks’ ProFarmer tour more or less confirmed suspicions that the US corn and soybean crops are in line with the last USDA estimate. Using past deviations from the USDA, the bean crop has the potential to be larger than the USDA projected. The USDA will issue the September supply and demand estimate on September 12th.

Soybean carryout is gaining more attention as the possibly looms of a number larger than 785 million bushels. Obviously, any additional increases in yield in the US will add to carryout, but there are others concerns that could add to ending stocks; such a reduction in demand from African Swine Flu in China and acreage expansion in South America could add more to world supplies.

While progress resolving the tariff battle with China is stagnant, NAFTA negotiations continue this week with Mexico as they try to reach an agreement with the US. Sources indication negotiations with Canada would soon follow, but the Canadian Prime Minister has hinted that they will not just give in to the US without some negotiating. The Prime Minister commented that they have made positive movement towards an agreement and was optimistic something could be worked out easily.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Friday, August 24th 2018

Today’s grain trade has seen a decent amount of profit taking as we head into the weekend. Corn and soybean futures are at critical levels last seen on the August 10th WASDE. These key support levels have been met after a week’s worth of fund selling as trader’s look to offset these positions. First notice day for September is next Friday August 31st while September options expired today at the close.

Many analyst argue that the aid package expected to be release to the public on Monday could cover a decent percentage of cash flow issues many will have during the harvest window. The timing of disbursement will have an influence on and skew farmer behavior as it will substitute for a portion of cash sales. The interesting part of this aid package is that it is based on actual 2018 production and not past averages or 2017 production that has not yet been marketed.

Nearby soybean processor bids are following export market. The steady pull back in nearby demand has caught many by surprise. The cash grain trade is quite nervous over space considerations, and the idea of emergency. Traditional corn space might be used as soybean storage as the consensus in the industry is that bean yields are pushing higher as we work our way to harvest.

September Corn finished the day up 1 cents at $3.48 . November Soybeans closed up 1 cents at $8.68. September Chicago Wheat finished the day down 8 cents at $5.13 .

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Weekly Market Review; Friday, August 24th, 2018

Grains struggle as the marketing year winds down

August weather is considered key for adding bushels to the soybean crop if timely rains occur. Over 80% of the U.S. soybean growing areas have seen above normal moisture levels for half of the past 30 days. Looking at the pod counts the ProFarmer tour saw this week would lead one to believe the crop has benefited from it. However, those high pods counts need to fill out completely to see the benefit of those rains.

Crop tour results seem to continue with a common theme, lots of variability in the corn crop. Some parts of the tour saw very good consistent stand counts and ear weights with strong yields, while other parts are seeing lower ear weights, uneven stand counts and yields short of expectations. Some of the scouts were interviewed noting that the crop is more inconsistent than in previous years, seeing better weed control particularly in soybeans and in some cases higher corn populations.

Export tariffs may have squashed soybean export potential, but corn exports have continued the keep up with expectations. Corn loadings are lagging just slightly, but sales are thought to meet the USDA’s target by Sept 1. A year ago, the USDA underestimated corn demand by 600 million bushels. If corn demand increases by the ten year average of 1.785%, that would increase 18/19 demand by 265 million bushels to 15.16 billion.

Soybean tariffs are not the only problem plaguing soybean prices currently. World supply is bulging and the most recent USDA forecast is reaffirming its not declining. Stocks to use ratios near 30% simply do not demand higher prices. Even if Chinese importing of US soybeans resumes to its previous pace, global demand has begun to ease back some and stocks will still be plentiful. Even If exports were to increase to pre-tariff levels, prices could rise 50 cents and still make soybeans difficult to be profitable. Expansion of soybean acres in South America could further add to the problem as planting begins there in mid-September. The weather, interest rates and currency values will be key to what expansion does in South America.

A little more clarification on the tariff aid package is expected to be released on Friday. Early indications are that aid will be based on actual 2018 production. It will not be based on past averages and not include any 2017 production that has not been marketed. Payment rates, who is eligible and payment limitations will be released in a Federal Register filing. The payment limitations to the program are expected to be at an adjusted gross income of $900,000. Wheat producers will likely be the firsts one eligible to apply as the program is expected to open on September 4th. These payments will be a part of the Market Facilitation Program and commodities eligible will be corn, soybeans, cotton, wheat, sorghum, dairy and hogs.

Russia announced plans to limiting wheat exports on thoughts of a smaller 2018 crop. Officials there last week talked of limits on exports even though the crop is thought to still be close to the five-year average. Exporters are trying to ramp up exports now amid higher prices for wheat before the limits could go into effect in the later part of the export season around the new year.

The US and Mexico are continuing their talks on the North American Free Trade Agreement (NAFTA) and there was hope it could be completed this week. No agreement has been finalized by progress has been made in forming some type of mutual agreement. The main sticking point holding up finalization is the automobile trade. With an agreement in place with Mexico, trader believes an agreement with Canada would soon follow. Canada has said they are optimistic they can finalize an agreement with the U.S. as progress with Mexico continues.

African Swine Fever has become a very serious issue for Chinese pork production as they found their 4th case this week. Russia has spent 10 years trying to control the disease, which can have mortality rates of 100%. The swine industry has never seen a case of it in an intensive production system and the control of the disease could become challenging. China accounts for 54% of the world pork demand. Even small changes in pork supply and demand in China can have a large impact on the world pork supply.

Historically speaking, the Pro Farmer crop tour is statistically inaccurate at calling USDA final yield results. On average, the tour has been low 11 out of the past 15 years, 2.7 bushels per acre for corn and .6 bushel per acre for soybeans. At this point of the year, right or wrong, the crop tour has the market keeping a close tabs on anything that is considered out of the ordinary.

With each passing day, analyst continue to make revisions on their balance sheets. Lately the drop off in soybean exports has been extremely troublesome for the interior market. Basis values in the PNW and CIF markets continue to deteriorate with harvest underway in Delta. This has been concerning to some, as the US has traditionally been a very aggressive exporter of beans in the first two quarters.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Morning Comments; Friday, August 24th, 2018

Historically speaking, the Pro Farmer crop tour is statistically inaccurate at calling USDA final yield results. Cherry picked areas along their routes with definite crop damage will absolutely draw the attention of the market, and sensationalize yield guesses. At this point of the year, right or wrong, the crop tour has the market keeping a close tabs on anything that is considered out of the ordinary.

With each passing day, analyst continue to make revisions on their balance sheets. Lately the drop off in soybean exports has been extremely troublesome for the interior market. Basis values in the PNW and CIF markets continue to deteriorate with harvest underway in delta. This has been concerning to some, as the US has traditionally been a very aggressive exporter of beans in the first two quarters.

Trade disputes continue to chase more uncertainty. President Trump has stated that he has no timetable to establish any new trade deals. This could have major implications down the road for the US market share of exportable grains. In theory, this would incentivize other countries to invest aggressively to meet their growing export demand they have replaced from the US.

Market Movers: Technical indicators, Export Sales

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Closing Comments; Thursday, August 23rd, 2018

Dalian corn futures rallied in last night’s session as the Chinese government issued statements in support of continued ethanol growth in the country. The approximate number of state owned corn stocks is questionable since they do not disclose total amounts. Many analysts believe this demand function is a way to reduce their over burdensome supply of reserves. Quality of this corn supply is also highly questionable with reports of excess damage.

Reports of damage from last year’s crop continue to surface as we bridge the gap between old and new crop. Many believe variability in stands coupled with a wetter than normal fall contributed to changing degrees of corn moistures in storage. With a crop that has pushed, in some cases, two weeks ahead, it is not out of the question we could see quality concerns, specifically lower test weights.

Exports sales for the week of August 16 are mixed. Corn exports were outside of expectations coming in at only 6.8 million bushels. This was down approximately 50 percent from the previous week and down 55 percent from the 4-week average. Soybeans were within analyst expectations coming in at 5.6 million bushels. This was up 14 percent from the week previous and down 38 percent from the 4-week average.

September Corn finished the day down 5 cents at $3.46. November Soybeans closed down 15 cents at $8.54. September Chicago Wheat closed down 2 cents at $5.23.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Thursday, August 23, 2018

Uncertainty moving forward.

Uncertainty is the name of the game in the soybean complex. With Pro Farmer tour pod counts better than expected and slow August rains, the market is anticipating a better than expected soybean crop. Interior basis values have also been breaking as of late. Buyers have nearly all the coverage they need until new crop. Combine all of this together just adds to the uncertainty and generates another possible increase from the 785 million bushel carryout from the August WASDE report.

This bearish bean scenario makes analyst believe that we could potentially see more corn acres next year. With December 2019 futures trading around $4, it is not out of the question that we are seeing corn buying more acres. Today’s economics makes the case for this. Arguably, the world corn balance sheet has a much friendlier story than beans.

Brazilian farmers are forecast to increase soybean acres for another consecutive year. This expansion would be a new record 90 million acres. This would be a 3% increase compared to an average of 5% increase year over year. Currency fluctuations have played a large part in driving this increase in acreage.

Market Movers: Global Trade Developments, Technical Indicators

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Closing Comments; Wednesday, August 22nd, 2018

Grains traded mixed most of the day with wheat managing to get back to near even and corn and soybeans were lower.

August is viewed as a key month for adding bushels to the soybean crop if timely rains occur. Over 80% of the U.S. soybean growing area has seen above normal moisture levels for half of the past 30 days. Looking at the pod counts the ProFarmer tour has seen would lead one to believe the crop has benefited from it. However, those high pods counts that have been seen need to fill out completely to see the benefit of those rains.

Details about the tariff aid package are starting to trickle out as we approach the expected release on Friday. Some media outlets are reports that payments are expected to be $1.65/bushel on soybeans and 2 cents/bushel for corn. These payments will be a part of the Market Facilitation Program and commodities eligible will be corn, soybeans, cotton, wheat, sorghum, dairy and hogs.

Crop tour results seem to continue with a common theme, lots of variability in the corn crop. In Illinois, one part of the tour is seeing very good consistent stand counts and ear weights with strong yields, while other parts are seeing lower ear weights, uneven stand counts and yields short of expectations. The other side of the tour in Iowa, near the Missouri border, was pleasantly surprised with yields in a part of the state that has been dry during the growing season. Some of the scouts were interviewed noting that the crop is more inconsistent than in previous years, seeing better weed control particularly in soybeans and in some cases higher corn populations.

September corn finished the session down 7 cents at $3.52 , November soybeans closed 15 cents lower at $8.70 , and September wheat in Chicago was 1 cent higher at $5.28 .

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Morning Comments; Wednesday, August 22nd, 2018

Grains are trading lower on the overnight session.

The ProFarmer tour made their way across Indiana in the eastern leg and Nebraska in the western leg on Tuesday. Scouts in Indiana noted more variability in corn than in Ohio, but noted that the beans were farther along in maturity. Indiana corn yield is estimated at 182.33 bu./acre and saw impressive soybean pods counts over 1300 per square yard. Scouts in Nebraska saw good yields on irrigated soils as expected but variability on dry land acres saw a range of 170 bushels. Heat during pollination, tip back and insect pressure also showed its toll in dry land acres. Corn yield for Nebraska is estimated at 179 bu/acre, significantly lower than the 193 pegged by the August USDA report. Soybean pod counts on the western leg were also impressive near 1300. The USDA has Nebraska at a record 61 bushels per acre soybean yield.

One thing that is consistent amongst the crop tour reports is the level of maturity of the corn crop. This week’s USDA crop progress report indicated corn was 15% ahead in the dent stage compared to last year and the 5-year average. Tour scouts are also noted stalk quality issues in some areas. An increase in rainfall during the next few weeks could amplify this problem.

There is already talk in the market about the dichotomy between next years’ endings stocks differences between corn and soybeans. This is leading to speculation of possibly 5 million more acres of corn in 2019. Sub $9 soybean futures do not offer much competition for corn acres in 2019. Not only could we see more corn acres next year, wheat and other crops could gain acres as they may offer some a better potential return than soybeans.

Market Movers: Reactions to ProFarmer tour results and world wheat export news.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Tuesday, August 21st, 2018

Grains traded lower most of the day after cooler weather and rains moved across the Corn Belt and generally strong crop tour results.

Export tariffs may have squashed soybean export potential, but corn exports have continued the keep up with expectations. Corn loadings are lagging just slightly, but sales are thought to meet the USDA’s target by Sept 1. A year ago, the USDA underestimated corn demand by 600 million bushels. If corn demand increases by the ten year average of 1.785%, that would increase 18/19 demand by 265 million bushels to 15.16 billion.

Soybean tariffs are not the only problem plaguing soybean prices currently. World supply is bulging and the most recent USDA forecast is reaffirming its not declining. Stocks to use ratios near 30% simply do not demand higher prices. Even if Chinese importing of US soybeans resumes to its previous pace, global demand has begun to ease back some and stocks will still be plentiful. Even If exports were to increase to pre-tariff levels, prices could rise 50 cents and still make soybeans difficult to be profitable. Expansion of soybean acres in South America could further add to the problem as planting begins there in mid-September. The weather, interest rates and currency values will be key to what expansion does in South America.

A little more clarification on the tariff aid package is expected to be released on Friday. Early indications are that aid will be based on actual 2018 production. It will not be based on past averages and not include any 2017 production that has not been marketed. Payment rates, who is eligible and payment limitations will be released in a Federal Register filing. The payment limitations to the program are expected to be at an adjusted gross income of $900,000. Wheat producers will likely be the firsts one eligible to apply as the program is expected to open on September 4th.

September corn finished the session down 2 cents at $3.59 , November soybeans closed 7 cents lower at $8.86, and September wheat in Chicago was 14 cents lower at $5.27 .

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Morning Comment; Tuesday, August 21st, 2018

Grains are trading lower on the overnight session.

The ProFarmer tour showed higher soybean pods counts versus a year ago in both the western leg in South Dakota and the eastern leg in Ohio yesterday. The western leg found an average of 179bu./acre for corn in South Dakota with a range of approximately 130 bushels. Some planting delays showed some variability in maturity equal to about average for this date. The eastern leg found similar yield results near 180 bu./acre for Ohio, but a smaller range of 70-100 bushels. They noted most of the corn crop is dented, showing its advanced maturity. In 11 out of 15 years, the tour’s yield estimate has been lower than the USDA September yield estimate by an average of 2.7 bushels for corn and .6 bushel for beans.

Crop ratings released yesterday afternoon were 2% lower for corn at 68% good/excellent, while the trade was looking for only a 1% drop. This would lead one to believe the crop is getting smaller, but we have to remember there is little if any correlation to crop ratings and final yield. The corn crop is more than 10% ahead in the dough stage compared to last year and the 5-year average. This is similar with the amount of corn in dent stage nearly 20% ahead of both last year and the 5-year average. Soybean ratings dropped 1% good/excellent to 65% and are more than 5% ahead of last year and the 5-year average in setting pods.

Weather forecasts for the next 14 days do not show much threat to final yield potential. August is considered a critical month for soybeans and recent rains should help with late season pod fill. The 6-10 day forecasts are wetter helping to solidify the significant yield bumps the USDA has made in the August supply and demand forecast. Heat is expected to return late in the week, but is expected to trigger thunderstorms, bringing more moisture that is beneficial to aid with grain fill.

Market Movers: Reactions to ProFarmer tour results and reactions to yesterday’s crop ratings.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.