The Good: Weekly sales of U.S. HRS were good this past week at 129,656 tonnes. The spring wheat market has struggled to gain traction over the past two months due to production increases and worries about demand. The demand concerns are a bit of a puzzle as Canadian wheat exports have been very strong with the past week (ending on August 9th) coming in at 423,900 tonnes. Total commitments for U.S. spring wheat are currently at 3.1 million tonnes for the U.S., which is 46 per cent of current export projection. Although we don’t have an insight on Canadian spring wheat sales, it appears that the trade has put on a large book for the next few months.
The Bad: Although the derecho winds did damage to the corn crop in Iowa and Illinois, the ProFarmer crop tour of surrounding states are very positive with record yield potential expected. The tour is moving through parts of Iowa and Illinois and certainly are reporting damage to corn and soybean fields. The corn and soybean markets seemed to pay attention to the positive yield news with soybean futures dropping nine to ten cents per bushel. Corn futures were mixed today with nearby contracts down one cent per bushel.
The Ugly: Canola markets were smacked today with the nearby November contract down C$4.80 per tonne to C$483.00 per tonne. The current resistance level for November canola are around the C$481.00 per tonne. This corresponds to the recent low set on August 12th. A move below the rent low opens up a drop to the C$475 per tonne level.