Grains Expected to Open Lower

Grains will open at 8:30 am CDT this morning following the long 4th of July holiday weekend in the US.

Grains are expected to open lower as weather forecasts continue to be favorable. There is a good chance of rain through Thursday that is expected to bring additional relief to much of the corn belt, with 6 to 15 day rains favoring the northwest Midwest. Parts of southeast Iowa/far west-central Illinois/far northeast Missouri/Michigan/northern Ohio and areas near the Nebraska/Kansas border (15 to 20% of the Midwest) appear at most risk to see rain deficits build further, but the timely rains occurring in other spots and a lack of severe heat will aid pollinating corn.

The 16 to 30 day outlook has trended cooler since Friday (particularly in the western Midwest), with potential dry spots focusing on parts of the eastern Midwest. While patchy showers are possible in the Delta soy areas (mainly in the 6 to 10 day), dryness is expected to build in parts of Arkansas/Mississippi/Louisiana, and hot temperatures will raise concerns for soy stress to increase. Rains continue to limit dry spots for U.S./Canada spring wheat.

On Friday, USDA reported May soybean crush at 160.8 MB, that was below pre-report estimates of 162.5.

Crude oil was off sharply to start the week as concerns about global economic growth weighed on the market. Data on China’s economy later this week is expected to show a slowdown, and continued fears over Britain’s exit from the EU continue to keep traders on the defensive. On Friday, the Baker Hughes rig count was up 11 to 341 rigs in operation. This is off the low of 316 set back in late May.

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

—Kevin McNew