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Market rollercoaster moves up and down on weather, Ukraine grain shipments and U.S. export sales

The first week of August started out low for the markets but rebounded by Friday, Randy Martinson of Martinson Ag Risk Management and Carah Hart of Red River Farm Network discussed on this week's Agweek Market Wrap. They talked changing weather forecasts, Ukraine grain shipments, U.S. export sales, yield potentials and more.

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The first week of August started out with "an ugly few sessions" to start the week, Randy Martinson of Martinson Ag Risk Management said on this week's Agweek Market Wrap. But by the end of the week, a variety of factors had pushed grains back up.

Martinson and Carah Hart of Red River Farm Network talked changing weather forecasts, Ukraine grain shipments, relations with China, U.S. export sales and yield potentials, as well as how those things moved the markets.

Hart said the first week in August was a bit of a "roller coaster." Besides the changing weather forecast, Martinson said the perception of grain moving out of Ukraine and Rep. Nancy Pelosi's visit to Taiwan changed by week's end.

On the Pelosi front, Martinson explained that there had been concerns that China would halt purchases from the U.S., which he characterized as "chest bumping" by China. But by week's end, China had purchased U.S. soybeans, and another purchase to an "unknown" destination may have gone to China, too, Hart said.

"90% of the time it is China that ends up taking the unknown destinations," Martinson said.

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Martinson explained that it's not unusual, seasonally, for the U.S. to start making export sales of new crop this time of year, as Brazil's crops have been moved and customers want the "newest and the freshest."

"Our sales will start to pick up quite a bit," he said.

On the weather side, there is pressure because of western Corn Belt weather not being ideal for corn development. Illinois is the "garden spot" right now, Martinson said, but you don't have to go very far to find less than ideal conditions.

In the northern Plains, spring wheat harvest is getting underway, and Martinson said he's heard reports of underwhelming results.

"The crop doesn't look as good as they'd like it to look," he said.

Similarly, the corn condition "would be phenomenal" were it the end of July rather than nearly a week into August, and there are concerns about having a long enough growing season to get it to maturity. Soybeans, similarly, have yield potential concerns.

With all those concerns, Martinson said next Friday's reports from USDA, which includes crop production and World Agricultural Supply and Demand Estimates, could be interesting. However, he anticipates that USDA will "punt" on major changes to numbers for now.

Cattle posted gains for the week, with help from better jobs numbers.

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"It's good to see the cattle market has been able to hold on and trade with some gains," he said.

But the level of prices are getting high enough that Martinson said it will be interesting to see if that holds, especially given the season.

The Agweek Market Wrap is sponsored by Gateway Building Systems.

Jenny Schlecht is the editor of Agweek and Sugarbeet Grower Magazine. She lives on a farm and ranch near Medina, North Dakota, with her husband and two daughters. You can reach her at jschlecht@agweek.com or 701-595-0425.
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