Corn Drops on Higher Yield Forecast
By Kirk Maltais
--Corn for December delivery fell 2.5% to $3.20 1/4 a bushel on
the Chicago Board of Trade Tuesday following new estimates by
StoneX of higher crop yields thanks to good weather in the Corn
--Wheat for September delivery fell 2.5% to $5.08 1/4 a
--Soybeans for November delivery fell 1.6% to $8.81 3/4 a
Mighty Maize: Good weather seen for U.S. crops may bring higher
yields than previously expected, said StoneX. In its latest
forecast for U.S. corn and soybean crops, StoneX predicts corn
yields at 182.4 bushels per acre and soybean yields at 54.2 bushels
per acre. That's up from the USDA's most recent estimates of 178.5
bushels per acre for corn and 49.8 bushels per acre for soybeans --
and has big implications for 2020 crop production. "If these are
close to the actual yield numbers than new crop corn ending stocks
are very close to 3 billion [bushels] and new crop soybean ending
stocks is pushing 800 million [bushels]," said Craig Turner of
Daniels Trading. "This implies harvest lows sub $3 for corn and low
$8 for soybeans." StoneX's figures were a main driver of trading
Sunny Outlook: Supporting StoneX's predictions was confirmation
from the USDA that crop conditions have stayed high this week.
According to the report yesterday, the U.S. corn crop in good or
excellent condition stayed at 72% this week, while soybean
condition rose one point to 73% good or excellent. Spring wheat
rose 3 points to 73% good or excellent as well. "Very little of the
crop is poorly rated... given current weather outlooks, these
numbers are expected to change very little next week as well," said
Karl Setzer of AgriVisor.
Everything Must Go: Farmers are increasingly selling their crops
from last year that they've been saving in hopes of prices rising
on the CBOT. "Cash-connected traders [say] that farm selling of old
crop corn has quickened this morning with many just giving up on
stored corn prices rising," said AgResource. "Farmers are willing
to accept a better basis bid today -- than what will likely be
offered during harvest."
Family Matters: Family farms that have declared bankruptcy under
Chapter 12 in the first half of 2020 are up 8% from the same
timeframe last year, the American Farm Bureau Federation says.
Total filings of farm bankruptcies are down 10 cases to 284 filings
in the first half of 2020, but family farms make up a bigger
portion of those cases. Additionally, bankruptcies reported in the
Midwest were up 23% for the first half of the year, according to
the AFBF. The implementation of the CARES Act has helped mitigate
Chapter 12 filings over the past three months, said John Newton of
the AFBF, but with the stimulus expiring that effect is expected to
--The EIA releases its weekly update on ethanol production and
inventories at 10:30 a.m. ET Wednesday.
--Corteva releases its second quarter earnings after the market
--Animal vaccine producer Zoetis Inc. releases its
second-quarter earnings before the market opens Thursday.
--The USDA will release its latest weekly export sales numbers
at 8:30 a.m. ET Thursday.
Write to Kirk Maltais at firstname.lastname@example.org
(END) Dow Jones Newswires
August 04, 2020 15:39 ET (19:39 GMT)
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