This is a sample entry from John Payne’s newsletter, This Week in Grain, published on Tuesday June 21, 2016.
Crop progress reports were released a few minutes ago to some fanfare but little change. Corn and soybeans stand poised to fall below recent lows if model runs don’t show something of note soon.
- Corn conditions remained static at 75% G/E, the level where they were a week ago and 6% better than a year ago.
- Iowa, Nebraska and Minnesota are at 79% G/E while Illinois sits at 74% G/E in corn. Its very, very difficult to trade with the idea yields may come in sub trend when the big 4 (sorry Indiana 72%) sit at fantastic levels like this. If this would stay sideways, I think the market may begin to look at yields above 170. Keep in mind its still early and the 6-10 day shows a lot of heat, but moisture is expected as well.
- Beans did see a 1% drop in ratings from 74% to 73%, but its nothing I would worry about yet. The start of a trend could be a concern, but at these levels were still looking at a huge crop at 81 .5 million acres. Bears should probably worry about a jump of 3-4 million acres which is now being thrown around by some.
- Cotton conditions were unchanged increased 1% to54% G/E, 1% less than a year ago.
- Winter wheat harvest is 25% completed vs 28% average, conditions remain unchanged from last week at 61% G/E.
- Spring wheat conditions fell 3% G/E to 76%. Its probably worth monitoring the spring crop if you are bullish.
- The bulls are going to probably point out the top soil moisture ratings which sit at 75% G/E and well below the 84% from a year ago, but the areas without moisture are not in the corn belt. Iowa is 76%, Minnesota is 95%, Illinois is at 70% and Indiana is at 68%. Nebraska irrigates so I don’t really care to judge it based off this.
Bottom line, weather bulls will need more to push prices above recent highs. Next week’s report will be a deciding factor on how much this stuff matters anyway, as acreage could jump across corn and beans which would ease the need for a bin buster.
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