Morning Comments July 23, 2020

Armor Seed Plot Sign

Opening Calls:

Corn: Steady to 1 Lower

Beans: 1 to 2 higher

Items impacting corn:

  • The market closed higher yesterday on fund short-covering
  • EIA ethanol production report was slightly bearish, with ethanol production substantially below the needed pace. This could lead the USDA to reduce their estimate for ethanol demand
  • Trading a little lower this morning before the export sales report
  • Trade continues to debate corn yield with bulls looking for 175 bu./acre and bears thinking 180 bu. or more

Items impacting soybeans:

  • USDA announced a sale to china of 26.3 million bu. with another 7.8 million sold to “unknown”
  • U.S. dollar is trading lower, making U.S. beans more competitive
  • Rising tensions between the U.S. and China could eventually affect China’s buying in the future
  • South American bean stocks are becoming tight which should benefit the U.S. over the next couple of months
  • Trade is looking at the possibility of bean yields working their way north of 50 bu./acre

With the current volatility in the markets, be sure to contact your local GMA to discuss marketing strategies on both old and new crop grain. We have several contracting alternatives to help you manage your risk. One example: “sell the carry” in corn. Currently, our bid for October 2021 is more than 25 cents better than October 2020.