Markets are trading with small losses this morning in a quiet trade as we head towards the July USDA numbers at 11 this morning.

Managed funds on Wednesday were estimated as net buyers of 2k corn to reduce the net short to 209k, net buyers of 3k beans to reduce the net short to 13k, and net buyers of 3k wheat to reduce the net short to 62k.

USDA will be out at 11. No major changes are expected for the US balance sheets with greatest potential for a large adjustment Brazil’s corn production.

Argentine corn harvest is now estimated at 76% complete, which is just behind the 5-year average of 78%.

Russia ordered measures to increase ag exports after wheat sales in the month of July were projected at their lowest level since 2008.

CONAB estimated Brazil’s corn crop at 131.97 mmt. The average guess for Brazil production on today’s USDA report is 132.53 mmt. They left bean production essentially unchanged at 169.5 mmt, which is very close to the USDA’s current estimate of 169 mmt.

Trump announced the U.S. would impose a 35% tariff on imports from Canada along with 15-20% blanket tariffs on most other trading partners.

China left their corn production estimate unchanged on their monthly update at 296.16 mmt (USDA 295).

December corn posted a higher high, higher low, and a slightly higher close on Thursday as the market consolidated ahead of today’s report. The market is oversold with that needing to be corrected before a move lower can resume. Support for Dec. is 4.10 and resistance 4.30.

Beans posted a lower low and lower high on Thursday, but the market posted a bullish reversal from lows to finish with gains. The market is oversold after recent losses.  Nov. support is 10.00 and resistance 10.10.

Corn is set to finish the week with sizable losses as favorable weather and growing crop prospects have limited buying interest. The market has consolidated the last couple days as managed funds have built an historically large net short and a lot of bearishness has been priced in. Old crop demand continues to be robust with exports continuing to thrive despite Brazil’s crop starting to flow in the market. Hold off on any new bearish positions.

Beans are set to finish the week with sizable losses as U.S. crop prospects continue to grow. Today’s report is expected to confirm record global supplies for this year and next with no tightness expected in U.S. or global balance sheets. With funds just starting to build a net short position in the beans, there is downside risk. Producers should use option strategies to provide floors.

Corn down 1-2

Beans down 4-5