Chicago Close: Crop Futures Down on Improving US Weather, Ukraine Grain Movement

US crop futures markets were down for the second day in a row, due to a combination of timely rain in the Midwest and indications a ship carrying Ukrainian grain is on track to arrive safely in Turkey.

The dominant factor driving the markets lower is the weather. The Midwest got scattered rain in recent days, and more is ahead. This has one widely followed brokerage firm suggesting critically dry areas will shrink to around 25% by mid August, down from more than 33% today.

Even before the latest bands of precipitation rolled through, US crop ratings were holding up well. Monday’s USDA crop progress report showed the nationwide corn crop at 61% good to excellent as of Sunday, steady compared to last week and a mild surprise with pre-report trade ideas calling for a small step down. At 60% good to excellent, the condition of the soybean crop improved a single point on the week, which ran counter to trade expectations for a small decline.

Meanwhile, the first shipment of grain from the Ukrainian port of Odesa, which sailed Monday, remains on track to arrive safely in Turkey. This is creating some optimism that Russian President Vladimir Putin will respect the terms of the deal to allow a larger export program of grain from Ukraine.

September Chicago wheat fell 25 1/2 cents Tuesday to $7.74 3/4. September Kansas City was down 24 1/4 cents at $8.42 1/4 and September Minneapolis lost 24 1/4 cents at $8.73 1/4.

September corn closed down 15 3/4 cents at $5.91 1/4 and December dropped 15 1/2 to $5.94 1/4.

August soybeans fell 25 cents to $15.69 1/4 and November was 19 1/2 cents lower at $13.86 1/2.

Source: DePutter Publishing Ltd.

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