Podcast Summary
Midwest farm challenges: Midwest farmers, including Belinda Verier from Maryland, face uncertainty due to delayed farm loans, potential tariffs, and foreign ownership bans, while battling crop-specific challenges and election season stress.
Soybean farmers in the Midwest, including Belinda Verier from Maryland, are facing multiple challenges this year. The Department of Agriculture has yet to update on farm loans, adding to farmers' concerns during the election season. Additionally, the potential for new tariffs on U.S. farm exports to China, as well as foreign land ownership bans, are causing uncertainty in the agricultural market. Farmers are dealing with these issues while also battling crop-specific challenges, such as slug infestations and late planting seasons. Despite these obstacles, Belinda remains optimistic about her crops in Maryland, particularly her soybeans and corn, which are showing promise after a difficult start to the growing season. Hay production is also ongoing, with top dressing for fungicides and fertilizers recently completed.
Farm bill uncertainty: The farmer's hay production increased by 30% due to biological additives, but they face uncertainty due to the lack of action on the farm bill, which could impact research and development for American agriculture.
The farmer's hay production was exceptionally good this year, thanks to the use of biological additives for fertilizers, which increased production by 30%. However, they are currently facing uncertainty due to the lack of action on the farm bill, which is holding farmers in limbo. The weather conditions in the Mid-Atlantic region were initially dry, leading to a drought situation, but were later saved by heavy rains brought by Hurricane Debbie. The planning season kickoff was slow due to issues with slugs, but the crops eventually grew despite the challenges. The farmer's main concerns regarding the farm bill are to ensure the continuation of research and development for American agriculture.
Corn Pollination, Central Illinois: Good pollination in central Illinois corn crop despite late planting due to coinciding heat episode, recent top dressing and fungicide application, and optimism for rest of growing season
Despite a later planting season, the corn crop in central Illinois has benefited from good pollination due to timing that coincided with a major heat episode. Farmer Jerry Guy Deall also mentioned that they recently completed top dressing and applying fungicide, just in time for the anticipated rainy weather. Looking ahead, Deall remains optimistic about the rest of the growing season, hoping for continued cooperation from the weather. On a different note, the USDA's August crop report is highly anticipated in the markets, but currently, they are experiencing a wait-and-see period. During the interview, Deall shared insights from a recent crop tour in central Illinois, which included stops in Grundy, Livingston, Woodford, and Whiteside counties.
Illinois crop yields: The Illinois 54 tour revealed an average yield of 113.7 bushels per acre, up from last year, with the highest yield recorded since 2016. Central Illinois' consistent good crop often indicates a strong overall yield for the state, with USDA predicting around 210 bushels per acre.
The Illinois 54 tour, which focuses on central Illinois counties in early August, provides valuable insights into the state's crop potential. The 2023 tour revealed an average yield of 113.7 bushels per acre, up from last year's 110.6 bushels. Notably, the highest yield recorded since 2016 was in these counties. While there are areas with dryness in the Eastern and Western Corn Belt, the consistency of a good crop in central Illinois often indicates a strong overall yield for the state. The USDA's estimate for Illinois corn yield is predicted to be around 210 bushels per acre, potentially even reaching 212 bushels. This information underlines the significance of monitoring crop yields in specific regions to assess the overall agricultural landscape.
US agricultural yield prospects: Despite some positive signs, US agricultural yield prospects have holes and negative investor sentiment due to large crop numbers, causing significant price drops for corn, wheat, and beans.
The agricultural yield prospects for the US are showing some positive signs for the first part of August, but there are still holes in the national yield prospects and negative investor sentiment due to already large crop numbers. The prices for corn, wheat, and beans have seen significant drops, with corn at $10, beans at $12, and wheat at $5. These are long-term numbers, and if the yields don't meet expectations, there could be price swings. The USDA will provide updates on harvested acres and yields for 2024. Jerry Guy from Midland Research and John Payne from Advanced Trading discussed these points on the latest Brady Hawk report.
USDA August Crop Production Report: First survey-based estimates of US corn and soybean yields are released, providing crucial information on harvested acreage and actual yield data. International production estimates from Ukraine, Russia, Brazil, and Argentina will also be closely monitored.
The USDA's August Crop Production Report is an essential release as it provides the first survey-based estimates of US corn and soybean yields. This report is crucial because the USDA used trend yield estimates in their previous reports, and this report includes actual yield surveys. Additionally, the report will provide an update on harvested acreage, which was not accounted for in the first acreage report due to flooding in certain regions. Another critical factor to watch is the corn production estimates from the Black Sea, specifically Ukraine and Russia, which compete with the US in the export market. Lastly, the production estimates from Brazil and Argentina will also be closely monitored for any potential changes. Although the final yield may vary significantly from this initial estimate, it serves as the first official USDA estimate for the 2021 crop season.
USDA reports, profit-taking: The USDA reports led to some profit-taking and short covering, but the market has continued to weaken due to late summer trends and recession concerns, indicating a bearish trend for corn and beans.
The USDA corn and bean reports this week led to some profit-taking and short covering, as evidenced by a decline in managed money's net short positions. However, the market has continued to weaken as we enter the late summer period, which historically tends to be bearish due to old crop sales and favorable weather conditions. Additionally, there are concerns about the potential impact of a recession on commodity markets, which could be a significant black swan event. Overall, the report and subsequent price action suggest a continued bearish trend for corn and beans.
Cattle market unpredictability: Producers should manage price movements instead of trying to predict them due to market unpredictability in both cattle and grain industries
The demand for beef is historically weak during the mid to late summer months due to fewer outdoor activities like picnics. However, unpredictability in markets was emphasized, as shown by the recent stock market volatility which significantly impacted the cattle market. Producers, whether of cattle or grains, should utilize available tools to manage price movements rather than trying to predict them. The grain market currently holds a large short position by managed money, adding to the uncertainty. Ultimately, the markets are unpredictable, and it's crucial for growers to protect their balance sheets. Thank you for tuning into Brian Basting from Advanced Trading on Brady Hotline Report. Corn futures finished down eight to nine cents, and soybean futures finished down four to six cents.
Market movements: Wheat futures decreased, cattle futures and lean hogs increased, crude oil and Dow Jones Industrial Average finished up, insights from Belinda Berber and Jerry Gilson on Advanced Trading
While wheat futures saw a decrease of seven to nine cents, the market saw an uptick in cattle futures with an increase of eight to nine cents, lean hogs finishing up four to five cents, and crude oil finishing with a rise of two to four cents. The Dow Jones Industrial Average also saw a small gain of 10 points. Our guests Belinda Berber and Jerry Gilson from Advanced Trading provided valuable insights into these market movements during our show. Unfortunately, we ran out of time, but you can listen to the full discussion on our YouTube channel. Remember to stay tuned for more insights on the backroads of Illinois. I'm Caesar Delgado, signing off for this week.