Corn Rises as Traders Take Positions Ahead of USDA Reports
Corn for December delivery rose 2.9% to $3.34 3/4 a bushel on the Chicago Board of Trade Monday, with grains traders stepping up short covering ahead of Tuesday's reports from the USDA.
Grains traders stepped up short-covering ahead of Tuesday's grain storage and planted acreage reports from the USDA, said Josh Graves of RJO Futures. "Today traders are adjusting their positions ahead of the report and there have been heavy short positions in July for some time now," said Mr. Graves. The CFTC's most recent commitment of traders report, issued following the close Friday, showed net shorts building for grains among managed money funds - with the fund net short in corn by nearly 286,000 contracts as of June 23, according to the CFTC. Funds are also net short by over 45,000 contract in soft red winter wheat, and short roughly 37,500 contracts of soft red winter wheat.
Grain Export Inspections Report Shows Fewer Soybeans For China -- Market Talk
11:44 ET - The USDA's weekly grain export inspections report showed only 342,512 metric tons of soybeans inspected for export this week--less than half of inspections at this time last year. Additionally, China isn't among the top destinations of US soybeans, with the top receivers being Egypt, Mexico and Japan. Soybeans trading on the CBOT are lower this morning, down 0.2%, amid tension between the US and China as well as some resurgence in Covid-19 cases in China. "China reported 17 new cases of coronavirus on Sunday, with 14 being in Beijing and the other three being people who entered the country from elsewhere," says Arlan Suderman of StoneX. "Coronavirus fears are common in the United States, but the fear level is much higher in China." (firstname.lastname@example.org; @kirkmaltais)
STORIES OF INTEREST:
Deforestation Reduces Corn Yields in Brazil, Says Study -- Market Talk
14:12 ET - Advancing farmland over native forest helped Brazil become a leading food producer, but it also may reduce corn yields by a median of 6%-8% each year, a Dartmouth study says. One of the researchers, Stephanie Spera, tells WSJ forest clearing added as many as eight warmer-than-average nights during the corn growing season, reducing yields by as much as 400 kg/ha, according to her models. "Even in our most conservative scenario, we still saw significant increases in temperature and decreases in corn yields." The changes don't affect soy, the country's largest grain export. (email@example.com; @ptrevisani)
Smithfield Foods Teaming With Granular to Aid Grain Farmers
Smithfield Foods Inc. Monday said it would work with Granular, a farm management software platform, to help grain farmers in its supply chain improve sustainability, efficiency and crop yield.
Smithfield said Granular "uses high-frequency, high-resolution satellite imagery to monitor fields, allowing farmers to mitigate in-field pests and resolve other yield-diminishing problems before they spread and require additional resources."
Expected Record Harvests See Investors Grow Bearish on Wheat -- Market Talk
1527 GMT - Despite rising on Monday, wheat prices have been in near-constant decline since March as the market prices in what is expected to be record harvests and ample supplies of the grain, says William Rutherford-Roberts, agricultural analyst at StoneX. Speculative investors are betting on further falls as net shorts on Chicago wheat are at their highest since mid-May 2019, he notes. This is "reflective of the impact favorable weather conditions are having both in the United States and across Europe on wheat crops, which are widely expected to contribute to the largest global wheat harvest on record," he says. Futures in Chicago are up 1.5% at $4.83 a bushel and up 0.8% in Paris at EUR180.25 a metric ton. (firstname.lastname@example.org)
Livestock Futures Finish Trading Higher -- Market Talk
15:28 ET - Livestock futures on the CME close higher, with August live-cattle futures rising 0.5% at 96.475 cents a pound, while August lean-hog futures gaining 0.7% at 48.45c. Even though futures gained, traders anticipate choppy trading and further downturns this week. "Beef prices remain in a short-term downtrend and until prices can find a floor, the market is vulnerable to speculative selling," RJO Futures says, noting beef cutout prices also fell Friday. (email@example.com; @kirkmaltais)