Corn futures were sharply lower on an improving weather forecast and overall commodity weakness. The extended forecast continues to call for cooler than normal temps, while some additional rain was added into the forecast in the morning update. Rain this week will be confined to the northern Midwest, but Iowa will see improved rain chances later this week. Additionally the 8-14 day forecast is showing additional rainfall for a large portion of the cornbelt. Corn ratings were down 1% to 62% good to excellent. North Dakota was down 5%, but most of the other states were just marginally changed. Sept corn traded to new lows today with levels not seen since early last fall.
Soybeans were down 35 cents in the nearby months as improving crop conditions started the selling off early this morning. Bean ratings were up 2% to 59% good to excellent. After Illinois bean ratings dropped 8% last week, ratings were back up 7% this week. North Dakota dropped by 7%, but South Dakota got 3% better. Soybeans are 82% blooming and 48% setting pods. Both of these figures are near the average. A forecast that is lacking of any real extreme heat and offers chances of moisture is near ideal for the critical month of August for beans. This added to the weakness today. The funds were large sellers today as they work to lighten up their long position. Nov. beans traded to their lowest level since late June. There is a gap to fill down to $9.58.
The markets will react to the next weather forecasts and the crop ratings as we see if the rains do materialize. Much of the damage has been done already to the crops in some areas and the market is already factoring that in. The August supply and demand reports will be the next market mover other than this late season weather. South American supplies are putting a huge damper on new crop export sales and that is pressuring the market as well. As we move forward in August it will become more difficult to rally the market on weather unless we start talking about early frost. That will be watched as we get into September and early October as many crops are behind development of a year ago.
If you have old crop corn to move you may need to just sell it and possibly re-own it with an option of some sort. It will be either that or hold and move in the new crop slot if you can. There are pretty big carries in the cash market today that would tell you to do that if you can. Basis may not improve much, even with the lower prices ,with the old crop supplies still needed to be marketed. That being said a little later harvest this year may help with using up some of the corn in the pipeline before harvest starts.
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