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weather continues to remain the driver of the weakness in US agriculture commodities. 



and Crop Progress


  • U.S.
    Southern Plains will continue to receive enough rainfall periodically to curb some of the recent heat and supplement irrigation (where available)
    • Crop
      and livestock stress will not be nearly as extreme as it was earlier this month anytime soon, although warming is expected in the second half of next week and into the following weekend


  • U.S.
    Delta weather will be favorably mixed with some of the driest areas getting some periodic rainfall to ease dryness, but more rain will be needed


  • U.S.
    southeastern states should start to dry down for a while late this week and into the weekend
    • Potential
      Tropical Cyclone Nine will bring moisture to the region again next week with some of it possibly moderate to heavy


  • Potential
    Tropical Cyclone Nine has moved across the Leeward Islands and will become tropical storm in the next couple of days
    • The
      system will it will influence the Greater Antilles Thursday into Saturday with some of the Bahamas also impacted
      • Very
        heavy rain and flooding is expected
    • This
      system has potential to bring stormy conditions to the U.S. and possibly Florida, although it is too soon to be precise on the system’s intensity or precise path because it has not yet fully evolved


  • West
    Texas cotton areas will experience some welcome showers and that will help hold back some of the excessive heat of late
    • Crops
      in the region will experience some improvement


  • U.S.
    Northern Plains and much of Canada’s Prairies will experience limited rainfall and warm temperatures over the next week
    • Western
      Alberta may have another bout of heavier rainfall coming over the next week, but it should be of short duration


  • Mexico
    precipitation in the coming week will be greatest in central and southern parts of the nation benefiting many corn, sorghum and dry bean production areas
    • Coffee,
      citrus, sugarcane and many fruit and vegetable crops will also benefit
    • Northern
      Mexico and especially the northeast will trend drier after rain fell beneficially from Tropical Depression Hanna Monday


  • Central
    America rainfall will be erratic this week and may trend heavier and more widespread next week


  • Western
    Europe weather will trend hotter over the next two days
    • Highs
      in France will reach into the 80s and 90s while the U.K. reaches into the 80s
    • Germany
      will experience late week high temperatures in the 80s and lower 90s
    • Very
      little rain will fall through the end of this week


  • Western
    Europe will cool down late this week and into the weekend with some limited rainfall expected
    • No
      general soaking will occur to bring significant relief to drought in France or dryness in other areas


  • Eastern
    Europe dryness remains in the lower Danube River Basin and southern Balkan Countries
    • Little
      relief is expected despite a few showers and thunderstorms infrequently


  • Dryness
    remains quite serious in southern and eastern Ukraine into western Kazakhstan and parts of Russia’s Southern Region and this region is unlikely to see much opportunity for relief anytime soon
    • Crop
      stress in unirrigated areas is quite high and production of dryland corn, soybeans, sunseed and other crops will be down


  • Russia’s
    New Lands are expecting some periodic showers and thunderstorms this week and milder temperatures
    • Partial
      relief to dryness is expected, but a general soaking of rain is not very likely outside of a few Ural Mountains’ region crop areas
    • A
      new high pressure ridge is expected to evolve next week that will return warmer temperatures and bring back drying which increases the importance of rain for this week


  • China’s
    weather is expected to progressively improve over the next two weeks with less frequent less intensive rain expected as time moves along
    • A
      tropical cyclone that will move over the East China Sea this weekend into next week should remove some of the potential for rain in east-central China and that will be a big relief
    • Another
      tropical cyclone will move into the southern coastal provinces late this week and during the weekend producing some heavy rainfall in those areas


  • Northern
    China will experience a good mix of rain and sunshine over the next two weeks resulting in ongoing favorable crop conditions
    • There
      is some potential for heavy rain early next week in the Korean Peninsula and China’s Northeast Provinces if a tropical cyclone evolves and moves through those areas as advertised


  • Xinjiang,
    China is not likely to change much over the next week to ten days
    • Daily
      high temperatures will be in the upper 70s and 80s northeast and in the upper 80s and 90s elsewhere followed by lows in the 50s and 60s with a few lower 70s in the southwest
    • Rain
      is expected in northeastern areas only with Monday, Wednesday and Thursday wettest with daily rainfall of 0.05 to 0.50 inch
      • Dry
        conditions will prevail elsewhere


  • India’s
    weather is expected to remain favorable for summer crop development even though some of the rain amounts will be more erratic and lighter than usual
    • Some
      net drying is expected
    • Central
      and northwestern Rajasthan will experience the least amount of rain over the next ten days as will central and southern Pakistan
    • Far
      southern India and a few locations from Odisha into southern Bangladesh will also receive well below average rainfall


  • Southeast
    Asia rainfall continued erratic Monday with very little change likely through the next couple of weeks
    • Parts
      of western Thailand, Vietnam and a few areas in Laos and Cambodia have received below average rainfall in recent weeks
      • Crop
        conditions have not been ideal, although there has been sufficient rain to prevent crop failure
        • Greater
          rain is needed, though
    • This
      trend will ease somewhat in the next two weeks with greater rainfall anticipated, but the greatest rainfall is expected to remain pocketed so that some areas will still need greater rain


  • Indonesia
    rainfall need is greatest for parts of Sumatra and Java


  • Philippines
    rainfall recently has been improving and this trend will continue for a while


  • Canada’s
    Prairies will experience net drying in southern and some central areas where the need for rain will be steadily rising as August begins
    • Rain
      is expected frequently in western and northern Alberta and more infrequently in northern Saskatchewan and Manitoba in the coming week
    • Rain
      may improve next week in other parts of the Prairies, but it will be erratic resulting in an ongoing need for greater rain in some areas


  • Australia
    rainfall over the next ten days will be erratic and often too light to benefit crop or field conditions, but winter crops should remain in favorable condition
    • South
      Australia and portions of Queensland still have the greatest need for additional moisture
    • Western
      Australia may receive some needed rain late next week while many other areas will remain drier biased


  • Argentina
    will be mostly dry over the coming week
    • Some
      rain may evolve in the south next week, but it is not likely to reach into the drought stricken areas of Cordoba or immediate neighboring areas


  • Southern
    Brazil remains favorably moist
    • More
      rain will fall periodically in far southern Brazil during the next couple of weeks
    • Winter
      crop conditions are mostly good in Rio Grande do Sul and areas north into Parana, but Sao Paulo and a few other areas have been quite dry recently
    • Summer
      crop harvest progress has been good
    • Conditions
      for early season corn planting are looking favorable, but timely rain will need to continue in August to ensure early crops are successful


  • Harvest
    weather in center west and center south Brazil for Safrinha crops has been and will continue to be good


  • Ontario
    and Quebec, Canada have some pockets of dryness, but most crops in the two provinces are still developing relatively well
    • Any
      missed rain could lead to greater crop stress and a close watch on the situation is warranted
    • Timely
      rain should occur in most of the region, but resulting amounts may vary greatly leaving a few areas in need of greater rain


  • South
    Africa weather over the next couple of weeks will include limited rainfall and temperatures will trend a little warmer over time.


  • West-central
    Africa will receive periods of rain over the next couple of weeks maintaining a favorable environment for coffee, cocoa, cotton, rice and sugarcane
    • Greater
      rain is needed in Ivory Coast and Ghana where rainfall so far this month has been notably lighter than usual
    • Most
      of the rain expected this week will continue erratic and often light
    • Temperatures
      may be a little cooler than usual


  • New
    Zealand rainfall over the next couple of weeks will be erratic and most often light with temperatures being near normal


  • Southern
    Oscillation Index was +5.77 this morning and the index will remain positive the remainder of this week and into the weekend


Day Precipitation Outlook

Ag Calendar

July 30:

  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
  • Port
    of Rouen data on French grain exports
  • The
    Australian Grains Industry Conference (online event)
  • Poland
    to publish grain harvest estimates

July 31:

  • ICE
    Futures Europe weekly commitments of traders report, 1:30pm (6:30pm London)
  • CFTC
    commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
  • FranceAgriMer
    weekly update on crop conditions
  • Malaysia’s
    palm oil export data for July 1-31 (tentative)
  • U.S.
    agricultural prices paid, received, 3pm
    Singapore, Indonesia, Malaysia

Bloomberg and FI




Wholesale Inventories (M/M) Jun P: -2.0% (est -0.5%; prev -1.2%)

Retail Inventories (M/M) Jun: -2.6% (est -2.7%; prevR -6.2%; prev -6.1%)

Advance Goods Trade Balance (USD) Jun: -70.6B (est -75.4B; prev -74.3B)

Pending Home Sales (M/M) Jun: 16.6% (est 15.0%; prev 44.3%)

Pending Home Sales NSA (Y/Y) Jun: 12.7% (est 2.2%; prev -10.4%)




Export Developments

  • None









  • September
    corn is seen in a $3.10 and $3.35 range over the short term.  December lows could reach $3.10.  We can’t justify below $3.00 unless a shock in the September grain stocks report occurs, or China’s production gets upward revised by a large amount. 



Soybeans traded lower on beneficial US weather and second consecutive day of no USDA export sales announcements.  Spreads were in focus on heavy bear spreading.  Despite lack of spot availability
for soybeans out of Brazil, CBOT August dropped 5.25 cents, September fell 3.25 cents, and November was down 2.25 cents.  There was talk of Brazil soybean cargo crew members tested positive for Covid-19, forcing China to detain the cargo.   Soybean meal dropped
$2.00 basis September, October $1.90 lower and December down $1.80.  The CBOT crush rallied in the front three positions and fell in the back months. 
oil was higher in part to a upside reversal in Malaysian palm oil and appreciation in South American premiums. 

Funds sold an estimated net 4,000 soybeans, sold 1,000 meal and bought 3,000 soybean oil. 

Argentina soybean and product premiums firmed. 

Brazil soybean oil cash market is on fire, in part to competing for what is left for soybeans to crush.   Oil World noted Brazil fob soybean oil appreciated to $805/ton basis September position,
up $29 from Tuesday.  Argentina fob was quoted at $752/ton for Aug/Sep.  US fob Gulf was $737/ton for Aug.   Later we heard Brazil soybean oil was offered +700 fob! 

Thursday is position day for August CBOT contracts. 

The Soybean Processors Association of India (SOPA) requested a reinstatement of the 5 percent export subsidy for soybean meal that would effectively stop all exports, in our opinion, and restrict
edible oils imports for next season.

Rabobank sees the Brazilian soybean area increasing 3 percent next season to 38 million hectares and production at 127.3 million tons.  All cropland is expected to increase 5.3 percent from the previous

ANEC estimates July Brazilian corn exports at 5.4 million tons and soybeans at 8.4 million tons. 

After retreating yesterday, ICE canola futures rallied today and reached a 21-month high.


Export Developments

  • None





  • September
    soybeans are seen in a $8.71-$9.10 range.
  • September
    soybean meal is seen in a $288 to $300 range. 
  • September
    soybean oil range is seen in a 28.40 to 30.50 range over the short term



  • US
    wheat futures

    traded higher on technical buying, downgrade in Russia’s wheat crop, and rumors SA was in for North American wheat. 
    Chicago wheat futures contracts failed to close below key moving averages yesterday.  Wheat/corn spreading might be noted for today. December KC wheat ended the day at nearly 130 cents above December corn, up from 117.50 cents Tuesday. 
  • We
    heard 3 cargoes of US hard wheat was sold to Brazil, and possibly one cargo from Ontario was sold to Brazil as well. 
  • Funds
    bought an estimated net 7,000 Chicago wheat contracts. 
  • SovEcon
    sees Russia’s wheat crop at 79.3 million tons, a downgrade from 79.7 million tons previous, but above USDA’s 76.5 million ton estimate and compares to 73.61 million for 2019-20. 
  • There
    are concerns about dryness for the next couple weeks for France, Germany and parts of the southern Balkan Countries as well as crop areas from eastern Ukraine into Kazakhstan and Russia’s southern region. 
  • For
    the US Northern Plains, net drying will occur over the next week.  Topsoil moisture is short for the western areas of the Northern Plains. 
  • Paris
    December wheat was up 0.50 at 182.50.  It was at high as 183.75 but gains were capped by  a strong euro. 
  • USDA
    Attaché estimated Argentina new-crop wheat production at 20 million tons, up from their forecast of 19.3 million tons for 2019-20. 



  • Tunisia
    seeks 50,000 tons of milling wheat, 25,000 tons of durum, and 100,000 tons of barley. 
  • Jordan
    cancelled their import tender for 120,000 tons of wheat. 
  • The
    Philippines seeks 216,000 tons of wheat on July 30 for September through December shipment. 
  • Yesterday
    Egypt bought 470,000 tons of wheat, including 350k Russia and 120k Ukrainian, for September 1-10 shipment.
    price paid was $215.10/ton.  With freight, C&F prices ranged from $228.05 to $229.05.  Note t
    paid $227.28 and $224.48/ton for Ukraine wheat on July 20. 
  • Results
    awaited:  Syria seeks 200,000 tons of milling wheat from Russia by July 28. 
  • Syria
    looks to sell and export 100,000 tons of feed barley with offers by Sep 1. 



None reported



  • Chicago September is seen in a
    $5.00-$5.50 range.
  • KC September; $4.25-$4.50 range. 
  • MN September $4.85-$5.20 range.


Terry Reilly

Senior Commodity Analyst – Grain and Oilseeds

Futures International │190 S LaSalle St., Suite 410│Chicago, IL  60603

W: 312.604.1366


AIM: fi_treilly


Skype: fi.treilly


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