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This Week in Ag (July 11)

Wednesday is set to be a big day, with all eyes on the World Agricultural Supply and Demand Estimates (WASDE) report, to be released by the US Department of Agriculture at noon eastern standard time.


Markets will look to the WASDE report for direction heading into the second half of the growing season.

The big June acreage report changes (up for corn, down for beans) should be reflected in the supply and demand estimates for those two key crops. One would expect that most of that impact has been priced into the market already as beans and corn have consolidated in the first trading days of July their respective gains and losses posted immediately following the report.

Crop condition scores for both corn and beans were unchanged this week, confirming the perception that recent rains have maintained or even slightly improved Midwest crop prospects. Winter wheat was reported this week as being roughly halfway through harvest, while spring wheat condition scores declined modestly on the week. Neither of these developments would lead one to expect big changes in the US wheat tables.

Cotton is interesting – condition scores have held on, despite lots of heat in Texas. The early season USDA reports have been optimistic on both the abandonment rate and yield for cotton, so they may be vulnerable to downside revisions if the weather is starting to take a toll.


Technical patterns in corn and beans remain on the same track as last week. Corn maintains its bearish moving-average trend signal in a slightly oversold market, while soy shows a bullish moving-average trend in a balanced market. Both are trading below and above their 200-day moving averages, respectively – corn significantly so.

The 10- and 25-day moving averages for wheat are narrowing towards a potential bearish cross, though nothing convincing has emerged yet. The same can be said for cotton, where prices have traded in a narrow band around 80 cents in early July.

The Commitments of Traders (COT) report for corn showed a hefty increase in open interest and a flip to the short side for managed money as of July 3. Soy also showed an increase in open interest and a reduction by 10,000 contracts of the managed-money long position. Cotton and wheat COT changes were unremarkable. Overall, the corn tech and COT picture seem to suggest some potential to support an upside move if WASDE could be the catalyst.


China reported this week a 5.4% decline in the Producer Price Index – a continuation of a run of lower numbers going back to October 2022. While not in and of itself a market mover, this month’s poor showing maintains concerns about the outlook for global commodities.

Specific to agricultural trade, we are only a week away from the expected expiration of the deal which has allowed transit of grain through the Black Sea. Russia has yet to show any sign of renewing its participation in the pact, which has been in place for the past year. Supply chains for alternative origins have improved over that period, but a definitive end to the current arrangement would seemingly push wheat prices higher, while any moves to renewal would be a surprise.

This content is for educational purposes only and is NOT financial advice. Before acting on any information you must consult with your financial advisor.