BASIC & RECENT MARKET INFO

Low volume trading in the CBOT markets makes swings more dramatic and fundamentals hard to trade. Open Interest (the number of open contracts that need to be offset at some future date) in corn futures plus options, was 1.75 million as of Tuesday. The 5-year average OI for the same period is 2.1 million contracts. OI in Chicago wheat was 401,000, which was a record low for the period, with a 5-year average at 478,000. OI in beans was 860,000 vs. 880,000 5-year average. USDA

Highlights Russian forces continue to hit port infrastructure and damaged a cargo terminal in Odessa. Over the last 10 days, 26 port facilities have been hit in Ukraine. It came to our attention yesterday midday that troubled PacWest Bank was going to be absorbed by the Banc of California. The deal was done two days before it became common knowledge. Here is the press release from the 25th which we did not see nor did anyone we know talk or write about it: "The Banc of Calif

Highlights Ukraine and the EU are considering rebuilding port facilities and fund transportation of grain to ports in Croatia and Lithuania. That will take at least US$1.5 billion and how many months or years? How long will it take a Russian drone to destroy the new construction? They need to spend $1.5 billion to end the war. But then, ending the war is not the goal. Keeping the war going is the goal so all participants in government and war insiders can earn and/or siphon-o

We have seen first-hand several soybean fields in Illinois and Indiana with yellow spots, like one would see in early September as the beans start to turn. Ron from north-central Illinois sent us this link about yellowing soybeans, which looks more serious: https://brownfieldagnews.com/news/midwest-agronomists-tracking-down-the-cause-of-yellow-soybeans/ Highlights No news about the grain corridor deal. Corn Belt weather continues with a drier outlook into next week at least.

Highlights After Wednesday’s less than expected retail inflation report for June at 0.2%, yesterday’s inflation at the wholesale level report for June was 0.1% and the resulting 12 month inflation rate was the smallest in nearly three years. It means the economy has entered a period of disinflation even with a very tight labor market. The run of softer inflation readings will bring an end the Federal Reserve tightening money supply campaign. Lower interest rates will reduce t

Market Comment & Clarification Roger apologizes for yesterday’s morning email sent discussing when to price your commodities. In no way was his intention to recommend you sell anything from a marketing standpoint. It was an effort to calm your nerves and it failed miserably. He is sorry. That email was intended to explain that pricing a commodity with your merchandiser does not need to be the end of the marketing of that commodity. In fact, pricing the commodity to your mer

Today at 11:00 Central Time, the USDA will release its June S&D report, which will most likely be a non-event. USDA seldom changes any US demand numbers on the March, June, September or December S&D because 20 days later, the Quarterly Grain Inventory report is released and that takes the guesswork out of the demand question. Speaking of which, do you remember the March soybean USDA inventory was 57 million bushels less than expected because the monthly crush and export numb

Highlights The OPEC+ meeting this Sunday was called by Saudi Arabia to chastise other members for pumping more crude oil than they agreed. Russia is at the top of the list of over-producers. In 1985, OPEC members agreed on production quotas. In early 1986, all OPEC members, except Saudi Arabia, were over-producing. In those days, Saudi Arabia was THE big hammer of crude oil production, bigger than they are now. To show the other OPEC members what real overproduction crude o

"Good afternoon Roger, You haven't said much about USA weather lately. Here in southeast Iowa it feels more like June 30th than May 30th. No humidity at all this past Memorial Day weekend which is so odd for us. It's super dry here and hasn't rained in two weeks and nothing at all on the extended forecast. Yards are even starting to go dormant and turn brown already. Never seen it so dry this time of the year. The early crops look good but a lot of population issues in corn a

Highlights Turkey’s President Erdogan has won the runoff election yesterday. His victory will make Putin happy. All the Asian markets opened higher today because of the debt ceiling deal. SUMMARY OF DEBT CEILING DEAL: Debt ceiling to be raised to cover deficit spending for 2 years Spending cuts of $50 billion, just 0.2% of GDP $10 billion removed from the recent budget increase for IRS No budget caps after 2025 No new taxes or government programs Boost in defense and VA spen

Highlights A load of USA economic news was released yesterday morning and all of it was better than expected, which means we are more likely to see higher interest rates to bring on that recession that all the government officials and ivory tower financial power houses have been predicting. The numbers: USA new unemployment jobless claims were 229,000, 6.5% less than the expected 245,000. Continuing unemployment claims were 1.794 million, 6,000 less than expected. First qu

Highlights Just before midday yesterday, negotiations on raising the US debt ceiling broke off, which pretty much sent all markets around the world lower except gold and silver, the traditional place to park money when the end of civilization is approaching. The issue is the House Republicans want no spending increase as part of the increased debt ceiling deal and Democrats say no way will they ever agree to that. The House of Representatives is the only government body whic

Highlights The fast planting progress for corn and beans with a favorable weather forecast kicked those two markets lower Monday evening. The sellers got a boost from a batch of Chinese economic data which showed industrial output and retail sales growth in April was less than expected and real estate investment values fell again. Both domestic and export growth engines were lackluster. Slow economy in China means reduced food demand. That means less pork (pigs eat a lot of

About Inflation "Roger, any thoughts on how bad inflation is going to get? Thanks, Mike" The Consumer Price Index (CPI) is the measure of inflation at the retail level of an economy. The Producer Price Index (PPI) is the measure of inflation at the wholesale level. Both indexes are a statistical estimate constructed using the prices of a sample of representative items whose prices are collected periodically. The representative samples used to calculate CPI and PPI have alr

Highlights Wheat harvest in Central Kansas started yesterday. They must have had some pretty dry weather… This is when wheat harvest usually starts in Texas. April jobs data on Friday was bullish and sent stocks soaring and bonds falling (higher interest rates). Interest rate hikes may not be pausing after all with the US adding jobs for the 13th consecutive month. The government reported the US added 253,000 jobs in April. The market expected 180,000. Where is that recessio

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Highlights Crop conditions and progress reports yesterday afternoon were slightly supportive for wheat. Corn, at 26% planted, was slightly less than trade expected, but in line with the 10-year average. Full report for all crops and states at: https://grainstats.com/ The 6 to 10 day forecast predicts above normal rainfall from Canada to the Gulf of Mexico for all crop areas, including the PNW, except Michigan, Northern Ohio and Eastern Colorado. JP Morgan acquired First R

Highlights Banking regulators decided Friday afternoon First Republic Bank cannot be saved; there is no more time to pursue a rescue through the private sector. The Federal Deposit Insurance Corporation (FDIC) said it was preparing to place First Republic Bank under receivership. Saturday morning, FDIC asked banks for their best and final offers by this afternoon to take over First Republic Bank. JP Morgan and PNC are the most likely bidders. Several other banks, including Ba

Highlights Yesterday was an economic gloom and doom day made even more negative because it might rain in Kansas. The G7 and several market analysts, according to the news media, said the Ukraine grain corridor deal will be renewed. Russia's Lavrov said again the sanction issues are not being resolved and the deal will not be renewed. The market seemed to be calling his bluff. Export deal or not, new crop Ukrainian wheat production is expected to fall nearly 40% with exports

Highlights USDA numbers made no sense for beans and, to lesser extent, corn. Basis, spreads and technical factors are our best predictors of futures prices Argentina’s “soy dollar” program bought very few soybeans the first two days of the program as farmers were not impressed with the 300 pesos per US dollar instead of the current (today) 213 pesos for everyone else in Argentina. Farmers, like all people in Argentina, are trying to survive with inflation over 100% per year,