8/23/2022

A nice mixture of bullish news sent the market into a buying frenzy. The first spark that helped light a fire under trade today was the weekly crop conditions update. The USDA lowered the corn crop conditions to 55% good/excellent versus the 57% expected by trade and soybean conditions were lowered 1 point to 57%, trade had expected that number to remain unchanged. ProFarmer tour has the market excited, as well, finding a poor crop in Southeastern South Dakota and Northeast Nebraska. The tour pinned the South Dakota corn yield at 118 after traveling through the heart of the worst crop conditions in the state (would be wise to take the over here). You don't have to travel very far North or West from their route to find ABOVE average crops in the state. The tour came in with higher corn and soybean yield estimates in Ohio compared to last year. Yesterday's rumored soybean sale to China was verified this morning with the USDA announcing 110,000 tonnes for delivery to China during the 2022/23 marketing year. Soybeans continue to be the easy seller but we need to start having some concerns about export demand for U.S. corn. If corn export business doesn't start seeing a solid uptick and some large sales, a 4 bu/ac loss across the U.S. may not matter on the balance sheet.

December corn gap higher on the open last night over the 50-day moving average, only adding a little more fuel to the trade fire. After peaking a 662’0 before the mid-day point, late money appeared to get a nervous. We closed below the 50% retracement line of the July low to the June high. Seasonally, we do not these rallies able to sustain themselves for long and corn already appears over bought only two days into the week.