Here are the numbers for this past week that USDA released this afternoon:
The crop retained its stellar rating at 74% rated Good/Excellent compared to last week.
The recent warm, dry weather did wonders to speed along the crop towards maturity with 96% of the crop dented compared to 90% last week and 95% last year at this time. The five year average is 97%.
60% of the crop is now fully mature compared to 42% last week and 60% last year. The five year average is 70%.
12% of the crop has been harvested compared to 7% last week and 11% last year at this time. The five year average is 23%.
The northern tier states are behind which is the reason that traders are reluctant to keep pressure on the corn right now as they want to see the % harvested move higher ahead of any potential wetness or killing freezes. That is giving the corn some lingering weather premium.
However, it should be noted that in those areas where harvest is either ongoing or has been completed, reported yields are coming in very, very strong.
The bean crop actually improved slightly this past week with 72% rated Good/Excellent compared to 71% last week. The Excellent category is where the increase came from as it gained 1% to 19 from 18 the previous week.
69% of the crop is now dropping leaves compared to 45% last week and 64% a year ago. The five year average is 71%.
On the harvest front - 10% of the bean crop has been harvested compared to 3% a week ago and 10% a year ago at the same time. The five year average is 17%.
About the same thing on the bean harvest as for the corn - it is lagging the 5 year average in some of the more northern states in particular but yields thus far that are coming in are incredibly high.
The market decided to move higher today ahead of tomorrow's USDA stockpiles report. the last number we had for old crop supplies stood at 130 million bushels. Some shorts decided to get out ahead of that number. I am not sure why anyone is especially interested in the old crop carryover at this point ahead of a carryover that is expected to be more than 3X that number but it could be some end of the quarter/month movement was involved here as well.
This afternoon's progress/condition reports show crops in outstanding condition and an ongoing harvest. Traders will react to any potential for harvest disruptions or freezes but unless any sort of hard freeze comes prior to the middle of this month, at this point, I do not believe it will make much difference in the general scheme of things. We'll see as we move forward.
One last thing - the corn/wheat spread continues to move against corn and in favor of wheat as it had started to do last week. I am watching wheat prices carefully to see if there is anything that might indicate a bottom is in for this market. Right now the chart is showing some decidedly bullish divergence on the RSI but the chart has not shown any confirmation of that in the form of a break over overhead resistance. A change in the handle from one of a "4" to that of a "5" might pique some interest among momentum-based buyers but for now the market is still in a bear trend undergoing some mild corrections higher.
What showed something similar in July and managed to rally about $0.40 before succumbing to another round of strong selling. It could conceivably rally to $5.00 but one would expect fresh selling to show up once again unless something had changed on the fundamental front.
Strength in the US Dollar has negated a considerable portion of the downdraft in US wheat prices.
Let's watch this however...( along with cattle for any sign of a blow off top which finally runs out of upside steam ).
On the hogs, the report has cast a bearish pall over that complex that will linger for a while but for the time being, the cash markets remain strong and with the board at a discount to the cash, we will need to see that turn before we can any move aggressive selling in this market. Expansion is here however and is not going away anytime soon. That is good news for those of us who are getting tired of paying the proverbial arm and leg for red meat.
Hey - Tuna Helper is looking pretty good right now! It's too bad beef is a perishable commodity because buying it last year and holding it would have been a helluva lot better than "stackin' gold". On second thought, I sense some real potential here for any newsletter writers who want to concoct some theories about Beef Backwardation ( notice how catching the "B and B" sounds), or Famed Cattle Insider claims Massive Beef Buying seen at Costco. How did I ever miss such an opportunity?! He could also claim that he just narrowly missed being hit by a runaway forklift driver who was moving dead carcasses at the feedlot where he was conducting undercover surveillance as part of his whistleblower activities!
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