The Van Trump Report

Weather, China, and Washington Remain Primary Focus for Ag

CORN bulls are hoping to find improved demand and a few weather hiccups in the forecast ahead. The USDA reported another week of strong export inspections which should keep us on track to beat the current USDA estimate. Ethanol should probably see another uptick this week as the economy fires back up. There’s been more debate and speculation about how many North Dakota acres will go to “preventive plant” or switched to soybeans. There’s also been debate about some acres in South Dakota and Minnesota. The USDA reported overall corn conditions at 70% rated GD/EX and just 5% rated P/VP vs. 59% rated GD/EX last year and 9% rated P/VP.

SOYBEAN bulls are happy to see China still in the market buying some U.S. supply and still no major political fallout between U.S. and Chinese leadership. Unfortunately, weekly export inspections still disappoint and most inside the trade suspect the USDA could be currently overestimating U.S. export demand by 50 to 75 million bushels. Bears worry that if political tensions escalate over Hong Kong and the early handling of coronavirus the USDA export estimate for U.S. soy could be even more overstated as the Chinese pullback purchases. As a bullish spec, I continue to worry about U.S. and Chinese relations and the possibility of strong U.S. production. Weather and Washington remain my primary focus. As a producer, I am still targeting a better window of opportunity for pricing bushels between Aug-Sept-Oct.

WHEAT remains mostly mixed as traders continue to closely monitor dry conditions in western Europe and the Black Sea region. I don’t really have anything new or enlightening to say about either. The forecasters seem to be calling for a bit more moisture for Russia an Ukraine and more uncertainty for western Europe. We will continue to pay close attention. U.S. and Chinese relations remain important for all U.S. agriculture and updated headlines could quickly change and impact price direction. Stay alert!

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