September contracts of corn, soybeans and all three wheats were lower Thursday, a victim of pre-report jitters even while the northwestern U.S. is dealing with a stretch of hot and dry weather. The September U.S. dollar index was trading higher, also offering bearish influence to grain prices.
Midday: Trade is weaker across the board at midday.
Corn trade is 4 to 5 cents lower at midday with selling ahead of the WASDE report tomorrow and a lack of fresh news. The forecast looks to continue the recent pattern in the near term keeping maturity moving right along. Ethanol margins will likely to see mixed action with flat corn trade and the end of summer driving hours with ethanol futures sliding again this morning with trade now 8 cents off the recent levels.
Corn basis is fading ahead of harvest and late season corn movement with harvest likely to start a couple weeks early this year. On the WASDE report, trade is looking for yield at 176.3 BPA, and new crop carryout at 1.630 billion bushels. Weekly export sales were solid at 554,500 metric tons of old crop, and 532,500 of new.
On the September chart futures have support at the 50-day at $3.65 with the upper Bollinger Band at 3.80, with the 200-day at $3.83 the next round higher.
Soybean trade is 4 to 7 cents lower with trade drifting lower ahead of the report in quiet action. Meal is 1.50 to $2.50 lower and oil is narrowly mixed. Another round of tariff threats has helped to maintain the Brazil premium and encourage selling nearby but there is some talk of China business getting done again on strong demand persisting into fall, even as their July exports fell off.
Bean basis has remained steady with processors taking the lead with crush margins remaining exceptionally strong but early bean harvest will likely surface this year. Weather could provide more support if August weather ends up on the dry side with the forecast limiting rain in many areas in the near term with the second week more mixed as maturity continues ahead of normal. Weekly export sales were OK at 421,800 metric tons of old, 532,500 of new, 109,600 of old meal, 19,900 of new meal, and 10,900 of oil. The daily wire also had 145,000 of meal sold to the Philippines.
On the WASDE report trade is looking for yield at 49.8 BPA, with new crop carryout at 641 million bushels. On the September chart trade is just below the 50-day at 8.99, with support the 10-day at $8.91.
Wheat trade is 3 to 8 cents lower at midday with trade seeing some selling ahead of the report coming on Friday and overbought conditions along with the weaker ruble. Spring wheat progress will pick up with the warmer weather returning this week with harvest expanding with mixed yields so far.
Trade continues to worry about taxes and restrictions off of the Black Sea as harvest wraps up but the cheaper currency will help to offset in the near term. HRW basis remains sideways to lower as the US struggles to compete on the export market even with the end of European harvest amid their difficulties. Australia remains on the dry side with the crop pace ahead of normal as well. Weekly export sales remained soft at 317,100 metric tons.
On the September Kansas City chart we are back above all the major moving averages with trade with the 10-day at 5.66, and the 20-day at 5.35 with the next resistance the contract high at 5.99.