Soybeans Higher in the Overnight
Soybeans traded higher in the overnight on light news and concerns that if dryness persists in parts of the Midwest, soybeans setting pods late could be effected.
The grains are mixed this morning with corn trading 3 cents higher, wheat 3 ¾ cents lower and August soybeans 12 cents higher this morning. The August soybean contract is trading at $12.24 ½ and has first notice on Thursday, July 31. Currently, the spread between August and September Soybeans is 96 ½ cents, down from over $1.40 at the beginning of July.
Over the weekend rains were scattered, but there are still areas of dryness in the western parts of the Grain Belt. This morning, the 6 to 10 day forecast is showing a drier than normal trend throughout most of the grain belt, but 8 to 14 day forecast looks to bring in more precipitation in the eastern and southern parts of the Corn Belt. Dryness in some parts of the Midwest has been a concern, but the lack of heat stress has limited its damaging effects.
Europe’s wheat harvest has been interrupted again by more precipitation helping perpetuate the quality concerns for this year’s wheat crop. Currently there is a large gap of up to $40 a ton depending on the quality of the wheat. In Germany, the showers should delay harvest only temporarily as hot weather allows producers to get back into the field following the rain event.
Australia which is currently struggling with dryness looks to see another three months without much relief. The Bureau of Meteorology said Thursday that dry weather is likely to persist across eastern Australia for the next three months. There’s around 60% chance of below median rainfall in northern Queensland, Southern New South Wales and most of Victoria. If these forecasts were to actualize, we would see a drag on yield from the world’s third largest wheat exporter.