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Transcript

Daily Market Podcast Jul 28 · M6 Capital Daily Market Podcast

• 0:00
  SPEAKER_00: Good morning.
• 0:00
  SPEAKER_00: This is Chris Myers with AM6 Capital Management with our Daily Market Letter on Tuesday morning, July 28th.
• 0:06
  SPEAKER_00: Walking in this morning, December corn is up three quarters at 474 and three quarters.
• 0:12
  SPEAKER_00: November beans are down five and three quarters at 12.08.
• 0:16
  SPEAKER_00: And December meal is off 90 cents at 323.2.
• 0:21
  SPEAKER_00: September crude oil is down$1.10 at$81.50.
• 0:26
  SPEAKER_00: As far as corn news this morning, the biggest piece of news is that USDA corn crop conditioning ratings yesterday declined four points from 67% good to excellent to 63%.
• 0:39
  SPEAKER_00: That's the biggest drop for this week in over 25 years.
• 0:44
  SPEAKER_00: The bigger declines occurred in the plain states with all the hot dry weather last week and with current hot dry weather forecast for this week.
• 1:16
  SPEAKER_00: Their current yield estimate is 183, so we would lean a little lower than what they currently have.
• 1:22
  SPEAKER_00: We remain longer term bullish for CBOT corn.
• 1:26
  SPEAKER_00: As for soybean news, CBOT soybean complex was sharply lower yesterday, with crude oil being down so hard and speculator profit taking.
• 1:36
  SPEAKER_00: As for the U.S.
• 1:37
  SPEAKER_00: soybean crop ratings, the good to excellent category was down three points from 66% to 63%.
• 1:44
  SPEAKER_00: That type of crop rating points to a 53 to maybe 54 bushel an acre U.S.
• 1:50
  SPEAKER_00: soybean yield from USDA on their August crop report versus their current estimate of 53 bushels an acre.
• 1:59
  SPEAKER_00: So we would lean towards a steady to slightly higher yield forecast there.
• 2:04
  SPEAKER_00: Meanwhile, China continues to buy more U.S.
• 2:07
  SPEAKER_00: soybeans and Brazilian soybean basis continues to firm.
• 2:11
  SPEAKER_00: This morning U.S.
• 2:12
  SPEAKER_00: Gulf is 30 cents a bushel cheaper than export beans from Paranaguá, Brazil for the September and October time period.
• 2:21
  SPEAKER_00: So U.S.
• 2:22
  SPEAKER_00: soybean business continues, export business continues to get better.
• 2:27
  SPEAKER_00: CBOT soybeans should be well supported because we've got multiple things going on, growing export program, very strong U.S.
• 2:37
  SPEAKER_00: crush margins, and declining crop ratings.
• 2:40
  SPEAKER_00: I've got charts uh in the middle of page one on the U.S.
• 2:45
  SPEAKER_00: percent rated good to excellent for corn and soybeans.
• 2:50
  SPEAKER_00: And then also this morning, I'm um we're covering some cattle news this morning.
• 2:54
  SPEAKER_00: I feel like this needs to be dealt with instead of waiting until Friday.
• 2:58
  SPEAKER_00: There are so many types of rumors floating around about how many cattle can and will come across the Mexican border once the border reopens on August 24th.
• 3:07
  SPEAKER_00: I fully believe that these uh numbers will be very slow with so many protocols and every animal being expected, and especially we being that Secretary Rollins will not want to look like an idiot.
• 3:22
  SPEAKER_00: I fully believe that import that inflow numbers will be very, very small.
• 3:27
  SPEAKER_00: If we look back at the March and April of 2025 time period, we were bringing in around 20,000 head per week.
• 3:37
  SPEAKER_00: And now we have more restrictions and less crossings open.
• 3:43
  SPEAKER_00: So if we assume somewhere in the neighborhood of 8,000 to 10,000 cattle come across per week for every week starting August 24th, for the remainder of this year, that gives us somewhere in the neighborhood of 150,000 head.
• 3:58
  SPEAKER_00: And I've got a chart, I've got two charts on the bottom of page one uh showing the weekly import pace and also the pace from August 24th through the end of December, um, where we can look at some history and see how many cow we brought across.
• 4:15
  SPEAKER_00: And 150,000 is still super small.
• 4:20
  SPEAKER_00: As far as weather goes, um, well, let's stick on cattle here for a minute.
• 4:25
  SPEAKER_00: So yesterday uh feeders were limited down um over ten dollars.
• 4:31
  SPEAKER_00: I just don't see that this breaking semi-feeders is warranted.
• 4:35
  SPEAKER_00: Um we're not fixing to have the gates wide open and here comes a flood of cattle.
• 4:40
  SPEAKER_00: That's just not happening.
• 4:41
  SPEAKER_00: So moving on to weather, uh, the corn belt remains um you know basically dryish this week, especially the plain states this week and next week.
• 4:52
  SPEAKER_00: Uh we have some still just smoking hot temperatures from Texas all the way to North Dakota the next several days.
• 5:00
  SPEAKER_00: Uh and even warm temperatures continue into next week.
• 5:04
  SPEAKER_00: But starting next week, we do return the central part of the corn belt and areas to the east.
• 5:10
  SPEAKER_00: Um, go back to a normal to above normal outlook for precep.
• 5:17
  SPEAKER_00: Also, um I'm gonna I'm gonna do this uh the next several weeks just so everybody can see uh how these crop ratings are shaping up.
• 5:25
  SPEAKER_00: On page three, I've got two maps.
• 5:28
  SPEAKER_00: One is for U.S.
• 5:29
  SPEAKER_00: corn and one is for soybeans, where I show I compute a crop condition index from all five categories of USDA's corn crop ratings, and I map those out and I show how do they compare versus a 20-year average for this week.
• 5:45
  SPEAKER_00: So you can see um the western states are dry uh and have got the lower corn ratings.
• 5:53
  SPEAKER_00: The far eastern states, Georgia, the Carolinas, uh are also dry and have low ratings, and the middle of the country is doing the best.
• 6:01
  SPEAKER_00: And that's obviously uh a similar story for soybeans, also.
• 6:05
  SPEAKER_00: That's it for today.
• 6:06
  SPEAKER_00: Thanks for listening.
• 6:07
  SPEAKER_00: We'll be back tomorrow.