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Mikkel Pates / Agweek

Crop tour supports larger yields


Wheat futures trended lower all week following Matif Wheat futures lower. Matif wheat futures traded to a 3 week low in the $203.75 per metric ton September range. Technical buying came into the market at the 100-day moving averages of $5.4175 December Chicago in both Aug. 22 and 23 trade.

Early week pressure came on thoughts that higher than expected rainfall over the weekend would recharge soils in the southern Winter Wheat Belt prior to fall seeding. Expectations of good rainfall for the week over roughly two-thirds of the Midwest continued to pressure the markets. There are reports of soft red winter wheat distributors being out of seed. This points to winter wheat acreage already being bought for fall planting.

Spring wheat conditions declined 1 percent last week to 74 percent good to excellent. Spring wheat harvest is at 60 percent compared to the five-year average of 44 percent.

Russia's Ag Ministry estimated their 2018 all feedgrains crops at 100 to 105 million metric tons, which is higher than the previous estimate of 100 million metric tons. However; they did leave their wheat estimate unchanged at 64.4 million metric tons.

Dismal export sales numbers continued this week adding more pressure to the wheat complex. Weekly export sales for all wheat were below trade expectations totaling 8.8 million bushels (239,800 metric tons) for the 2018-19 marketing year. Total shipments plus outstanding sales of 314 million bushels are 26 percent below the previous marketing year. Weekly shipments of 16.9 million bushels put total shipments 34 percent below the previous year.

The U.S. dollar held support at $94.83 in Aug. 22 trade before rebounding higher. The uptrend of the U.S. dollar continue to weigh poorly on U.S. exports.

For the week ending Aug. 23, September contracts for Minneapolis wheat were down 26.5 cents, down 38.5 cents for Chicago wheat, and down 37.75 cents for Kansas City wheat.


The corn market trended down all week in response to the Pro Farmer Midwest Crop Tour finding exceptional average yield results. Day one results for Ohio came in at 179.57 bushels per acre, 25.59 bushels per acre above the 153.98 bushels per acre for the 2015-17 average. South Dakota yields were 178.01 bushels per acre, 23.45 bushels per acre higher than the 154.56 average in 2015-17. Day two results from Indiana showed 182.33 bushels per acre, almost 10 bushels per acre higher than the 2015-17 average. Nebraska was more than 16 bushels higher than the 2015-17 average at 179.17 bushels per acre. Day three results showed Illinois more than 10 bushels per acre higher than the 2015-17 average at 192.63 bushels per acre. Iowa yields broken out by district showed the northwest and west central districts 2 to 4 bushels an acre higher than the 2015-17 average.

Ethanol production for the week ending Aug. 17 averaged 1.073 million barrels per day. This is up 0.09 percent versus last week and up 2.0 percent versus last year. Total ethanol production for the week was 7.511 million barrels. Stocks as of Aug. 17 were 23.259 million barrels. This is up 1.05 percent versus last week and up 8.14 percent versus last year. This is a record high stocks number for mid-August, and the highest since mid-March. U.S. gasoline demand last week was 9.453 million barrels per day, 1.8 percent below last year. Calendar year gasoline demand is up 1.2 percent from last year. Crude oil stocks declined 4.34 million barrels more than trade expected in weekly reporting to 408.36 million barrels. This supported a $2.00 higher move in crude oil futures in Aug. 22 trade.

On the evening of Aug. 22-23, China announced that it will promote ethanol usage in 15 regions. This provided temporary support to the market overnight but continuing high yield results from Pro Farmer continued the weeks downtrend. We are at the time of year when we typically put in a short term low, more notoriously known as the deferred payment low as most elevators will not allow old crop bushels to be rolled into new crop bushels. It almost always seems to happen that the trade knows how many bushels are out there and farmers are forced to sell elevator stored bushels at a lower point in the market. Hopefully, with the worldwide wheat situation we can get some kind of recovery into mid September.

Weekly export sales were 173,400 metric tons for 2017-18 and 1,054,600 metric tons for 2018-19. Total shipments plus outstanding sales are 2.379 billion bushels for 2017-18, 7 percent higher than the previous marketing year. Weekly export shipments of 51.7 million bushels put the total marketing year shipments up 2 percent from a year ago.

According to an article from Agri-Pulse, corn farmers will be disappointed by the amounts of the $12 billion dollar aid package as corn exports were not nearly impacted to the degree soybean exports were. Corn farmers did not make a pitch to U.S. Department of Agriculture officials for a specific level of help under the trade assistance package. December corn resistance is at $3.7025. Support is $3.6475. For the week ending Aug. 23, December was down 17.75 cents.


Soybean futures were under pressure this week as Midwest weather has been cooperative and should help this crop mature in good shape. Just like the last few years, we have not seen the hot, dry August weather we have come to remember in the past. Just when it looks like there are going to be some problem areas, the rains fall and weather cools across the Midwest to ease concerns. For the week ending Aug. 23, November soybeans were down 38.75 cents.

The crop tour is showing good pod counts and shows the yield potential should be good again this year. Soybeans are near impossible to judge before they get into the bin, but the one thing we are pretty sure of is that potential production problems have been averted for another year. Soybean crop condition ratings on Aug. 19 were down 1 percent to 65 percent good to excellent. Pro Ag's yield model was lowered a quarter bushel from last week and is almost 3 bushels less than the USDA is projecting.

There has not been much good news coming from the mid-level trade talks with China. The U.S. and China met on Aug. 22-23 to try and resolve the trade issues. Expectations are low for these meetings, and were dragged even lower the U.S. threw another round of 25 percent tariffs on China on Wednesday night. The hope was that they would find a starting point in negotiations (or even a tentative agreement) before the two countries meet at multilateral summits in November. Neither the U.S. or China have blinked during the ongoing negotiations though. One would think China would be willing to get back to the negotiating table as China watches the U.S. economy continue to stay strong with the stock market near record highs while China's economy continues its slide. But China is a Communist nation and they play by a different set of rules.

The U.S. dollar was sharply lower this past week after President Donald Trump criticized the Federal Reserve and its monetary policy moves, especially the continued increase of interest rates. He goes on to say that "he should be given some help by the Fed" to grow the U.S. economy.

Final numbers are expected to come out soon about how the $12 billion dollar tariff package will be distributed. Farmers are hoping this number will be enough to partially help offset the price damage done by the tariff war with China. The USDA has been given total control over the coming package, which is now at the Office of Management and Budget for final review. Signup for the assistance is scheduled to begin Sept. 4. Farmers have to file 2018 crop production data with USDA. Payment rates will be based on actual 2018 production and not on average yields over the past few years. The plan is limited to 2018 production and not existing 2017 crop still to be marketed.

DISCLAMER: These preliminary numbers have been reported by Agri-Pulse, but they have not been verified by the USDA as of Aug. 23. The package is expected to have a payment rate of $1.65 per bushel for soybeans and 1 cent per bushel for corn.

The six to 10 and eight to 14 day outlooks put heat back in the forecast across the Midwest. The outlooks are keeping rain in the forecast for the northern tier states of the Midwest but took the moisture out of the Central Plains and the Delta.


For the week ending Aug. 23, November canola futures in Winnipeg were down $14.5 Canadian to $496.3 per metric ton Canadian. The Canadian dollar was down .0041 at .7605. This brings the U.S. price to $17.12 per hundredweight.

• Velva, N.D., $15.31 per hundredweight, October at $15.45.

• Enderlin, N.D., $16.00 per hundredweight, November at $15.96.

• Hallock, Minn., $15.56 per hundredweight, October at $16.01.

• Fargo, N.D., $15.95 per hundredweight, September at $16.10.


Cash feed barley bids in Minneapolis were at $2.85, while malting barley received no quote. The Berthold, N.D., bid is $2.50 and the CHS Southwest New Salem, N.D., bid is $2.85.


Cash bids for milling quality durum are $4.80 in Berthold and at $4.95 in Dickinson, N.D.


Cash sunflower bids in Fargo were at $17.30, and October was at $17.30. For the week ending Aug. 23, soybean oil was down 15 cents at $28.08 on the September contract.