Corn and soybeans finished lower for a third day after President Donald Trump tweeted new 10% tariffs on $300 billion of Chinese goods will be enacted Sept. 1. Dow Jones Industrials were trading up 260 points before the tweets and are now 230 points lower in the afternoon session.
Midday: Corn futures are 4 to 5 cents lower; soybeans futures are 5 to 6 cents lower and wheat futures are 2 cents to 10 cents lower. Outside markets are mixed.
Corn futures are 4 to 5 cents lower at midday with the $4.00 area failing to hold this morning as trade continues to get more oversold. Cooler weather looks to prevail for the most part as we head into August with better rains in spots leaving some areas short. Ethanol margins remain poor with stocks continuing to balloon, which will likely idle more plants in the near term.
Basis has started to steady after the recent weakness in some areas as well with harvest starting in the Southeast U.S. with softer spreads taking the Sept to Dec spread back to a dime before narrowing slightly Thursday morning. Weekly export sales remain slow at 143,100 metric tons (mt) old crop and 126,900 mt new crop.
On the September nearby chart, support is the fresh low at $3.95 and resistance is the lower Bollinger Band at $4.04 with oversold conditions still in place.
Soybean futures are 4 to 6 cents lower at midday with trade grinding along at the recent lows after the washout Wednesday. Meal futures are $2.50 to $3.50 lower and soy oil futures are 15 to 25 points higher, with crush margins still steady and meal edging below $300 overnight. World export demand remains slow, with the dollar keeping the U.S. at a disadvantage.
Trade deal progress looks to be at a standstill again, which will make the secondary MFP trade payments more likely. Weather will come into focus more as we head towards August and pod fill with immediate stress looking more limited with the expected cool down. The slowness of the crop should continue to garner some light concern in the marketplace with more susceptibility to damage if an early frost would occur.
Weekly export sales remain soft at 143,100 mt of old crop, 305,500 mt of new, 113,500 mt of old meal, 46,500 mt of new meal, and 14,900 mt of oil. The September chart support is the fresh low at $8.62, with the next level up the 10-day moving average at $8.87, with 200-day average at $9.15 the next level up.
Wheat futures are 2 to 10 cents lower at midday with early support giving way to selling from the opening bell of the day session. The KC/Chicago spread has narrowed Thursday morning but remains near the highs at 63 cents. The corn/HRW spread is back to 22 cents. Chicago trade is down to 5 cents of carry with the intra-month spreads slightly weaker Thursday.
Winter wheat harvest is entering the final stages with spring wheat still a little off from hitting full swing. Europe and the Black Sea continue to make progress. The dollar is at a new high for the year, post Fed statement. Weekly export sales were in line with recent weeks at 383,100 mt.
The September KC chart support is the recent low at $4.13 1/2 with the first resistance the 10-day average at $4.32, with the 20-day average at $4.41 the next round up.