This morning the grain markets are mostly unchanged to slightly higher here with September corn up ½ a cent, September wheat up 2 cents and august soybeans up 2 ¾ cents.
The weather forecast has turned drier in the western half of the grain belt with the next 10 days looking to bring more dry weather to that region. Today should bring some showers to southeastern Minnesota, northeastern Iowa, Illinois and southern Ohio. Rains will be needed during August to maintain the crop quality in the western half of the grain belt. Right now, soybeans and corn in Minnesota, North Dakota, South Dakota and Wisconsin which received significant precipitation during the earliest parts of the season will be most susceptible to moisture stress due to their shallow rooting. Despite the drier weather outlook, we continued to see selling pressure yesterday as soybeans broke through key support of $10.65 and impulse lower.
Two military jets were shot down in Eastern Ukraine this morning, but at the moment wheat futures are not showing any buying interest as a result. The USDA’s attache in Ukraine released a report yesterday after the market close stating that harvest in Eastern Ukraine had been slowed by the military conflict but “Grain exports for the new marketing year are starting off well.” U.S. wheat futures are showing very little interest in the Ukraine story following one day of buying last week. We will continue to monitor the situation for any changes in the export outlook.
Weekly ethanol production will be released at 9:30 central time and is expected to show another strong week of U.S. ethanol production. A collapsing corn market has helped to offset lower DDG prices and a sideways ethanol market. Ethanol facilities remain aggressive bidders of old crop corn. Anyone with remaining old crop bushels may find premium at ethanol facilities for late season sales.