Weekly Market Update 7-18-24

Here is your weekly market update from the Garden City Co-op Grain Origination Team.

Trivia

1. Originally, Amazon only sold what kind or products?

2. Who won the first season of American Idol?

Answers at the bottom.

Market News

JULY WASDE: CORN: Corn was the surprise of the day with traders expecting to see larger carry outs – but USDA threw a curve ball reducing carry outs and increasing old crop and new crop demand. Expected yield was left alone at 181 bushels per acre. Unfortunately these changes in the balance sheet were not enough to get the market rallying in any material way. SOYBEANS: Beans saw minimal changes to their balance sheets, with a slight reduction to old crop carryout and a slight decrease to 2024 production. WHEAT: July WASDE was not friendly for the wheat market, with increases in old crop carryout and decreases in old crop demand resulting in an increased new crop carry in. Increases to new crop demand were outweighed by the increase in carry in, which paired with increased production resulted in a higher new crop carryout as well. WASDE told the story that we are all seeing in our backyards… this crop was better than expected and it doesn’t seem like anyone wants it that bad.
 
EXPORT INSPECTIONS: This week, 19.6 million bushels of wheat were inspected by the USDA, well above current USDA trade estimates. Hard red wheat exports this week will be making the journey to Brazil, Mexico, Taiwan, and the Dominican Republic. A total of 7.9 million bushels of HRS made USDA inspections this week, with both Taiwan and China taking 2.5 million bushels of HRS wheat, and Mexico taking the remaining 1.5 million bushels. Mexico once again leads the export market for SRW, taking a total of 2.3 million bushels. Like the last few weeks, white wheat traveled to Taiwan and the Philippines, with no durum wheat exports reported. A total of 42.5 million bushels of corn made inspections this week; slightly above inspections for the week of 7/4/2024. Mexico leads exports this week, taking 21.9 million bushels of exported corn. Corn export inspections remain 2% below total USDA year-to-date targets. Soybeans saw a total of 6.2 million bushels inspected this week, with milo seeing a total of 2.8 million bushels inspected.

EXPORT SALES: Falling below USDA estimates this week, O/C corn sales total 17.2 million bushels, while N/C sales were recorded at 19.1 million bushels. Old crop wheat sales were close to the week’s USDA targets at 21.3 million bushels sold. There were no N/C wheat sales reported this week. Old crop soybean sales were recorded at 13.2 million bushels this week, while N/C sales totaled 13.8 million bushels; total soybean sales remain 2% below USDA year-to-date sales needed to reach total target volume. A total of 2.4 million bushels of O/C milo were sold this week, while N/C sales totaled 2.0 million bushels. In total, to reach yearly USDA targets for milo sales, we currently remain 3% above estimated targets.

Interest Rate Market: Top Federal Reserve officials have indicated that they are likely to implement looser monetary policy. They mentioned the improved trajectory of inflation and a more balanced labor market, which suggests a potential rate cut in September. Financial markets are pricing in a rate cut in November and December. The officials are confident in the continuing disinflationary trend and are considering a policy easing in September. More Fed policymakers have suggested they are increasingly comfortable with the pace of price increases being more firmly on track back down to 2%, after higher-than-expected readings earlier in the year. The recent inflation has decreased from its peak two years ago, but the progress has been uneven across different categories. However, Fed Governor Adriana Kugler mentioned that goods, services, and housing are now contributing to easing price pressures. She expressed cautious optimism about progress and its potential impact on reaching the 2% target. In May, inflation was at a 2.6% annual rate, down from the peak of 7.1% during the COVID-19 pandemic. Data for June is expected on July 26. Fed chief Powell also indicated that recent inflation readings increase confidence in its downward trajectory, hinting at a potential easing cycle. It's believed that the central bank may be able to bring down inflation without causing a recession or a sharp rise in unemployment. Nonetheless, the unemployment rate rose to 4.1% in June, signaling potential risks.



Weather: The remainder of the day appears to be mostly sunny, with a high of 87°F and winds coming out of the south/southeast at 10 to 13 mph. There is a 20% chance of showers this evening before 1 am and a low around 64°F. Friday is predicted to be mostly sunny, with a high near 92°F and wind gusts as high as 28 mph possible. Friday evening looks like a 50% chance of scattered showers and thunderstorms. Saturday appears to be a 20% chance of precipitation throughout the day and evening hours with a high in the mid- to upper-80s. Its looking like Sunday will be partly sunny with a high near 83°F and a 30% chance of scattered showers and thunderstorms are predicted after 1 am. The rest of the week appears mostly clear, with a 20% chance of precipitation on Monday, high temperatures are expected in the mid- to high-80s throughout the remainder of the week. Low temperatures are expected to be in the upper 80s during the evenings this week.

Trivia Answers

1. Books

2. Kelly Clarkson