Sept corn unchanged at $3.1125
Nov beans down ¼ at $8.7775
The DOW is down
USD is stronger
Crude oil down $.18 at $41.77
Corn bulls are pointing to strong weekly new-crop sales numbers and pockets of dry conditions in the top-producing state of Iowa. Most of the big new-crop export sales were announced late last week but just now showing up in the weekly report, so not really any fresh news here. The latest drought map however shows the state of Iowa jumping from 62 to 79% “abnormally dry”, and +6% of the state, mainly western Iowa now considered “extreme drought” vs. 0% last week.
Soybean bulls point to continued incremental buying by the Chinese, perhaps more limited supply available out of South America, and an improved macro landscape for commodities with the weaker dollar. Bears are talking about the very real possibility of a record-setting yield being harvested here in the U.S. and the talk of increasing soybean acres being planted in South America the upcoming season. The Chinese debates still seem mostly two-sided, i.e. Bears saying the Chinese will be tapering back their purchases ahead of the upcoming election and that relations are going to get worse before they get better. Bulls are saying the Chinese have a food inflation problem that is concerning, SAM supplies are becoming more limited, so the Chinese have very little choice but to keep buying U.S. supply for the next few months.
To assist Farm Storage Facility Loan (FSFL) borrowers experiencing financial hardship from the pandemic and other challenges in production agriculture, USDA’s Farm Service Agency (FSA) is offering a one-time annual installment payment deferral option. No fees or prepayment penalties apply for borrowers who choose this FSFL loan flexibility option. Eligible borrowers can request a one-time only annual installment payment deferral for loans having terms of three, five, seven or ten years. The installment deferral option is not available for 12-year term loans. The FSFL installment payments will remain the same, except for the last year. The original loan interest rate and annual payment due date will remain the same. However, because the installment payment deferral is a one-year loan term extension, the final payment will be higher due to additional accrued interest.
An ag economist says USDA underestimated the economic need from producers of some commodities, while others have yet to claim their allotted funds through the Coronavirus Food Assistance Program. John Newton, Chief Economist for American Farm Bureau tells Brownfield as of August 3rd, sheep producers had received 140% of their estimated CFAP funds. “USDA probably had a pretty conservative estimate on what CFAP support would go out to those producers and it turns out based on the payment data there are more producers impacted than I think USDA initially estimated.” On the other hand, Newton says some commodities have used less than USDA expected so far with less than a month left to apply. “We’ve really got to get the word out to those fruit and vegetable producers who have only received about 10% of their estimated support.” Newton says historically, USDA has not given direct payments to sheep or specialty crop producers, so they had little data to base their original estimates on. Applications will be accepted until August 28th.
The ethanol industry continues to wait for a decision from EPA on 86 pending small-refinery exemptions after the U.S. Department of Energy finished a review and sent those requests back to EPA. During a news conference on Thursday, Renewable Fuels Association President and CEO Geoff Cooper said the small-refinery exemption program needs to be transparent. A report from Hoosier Ag Today, citing unnamed sources, said the DOE had recommended EPA approve some of the pending 58 retroactive waiver requests to the Renewable Fuel Standard. The EPA still has a total of 86 pending requests for small-refinery exemptions, including a total of 28 for 2019 and 2020. Cooper said the agency already has missed the 90-day deadline to issue decisions on the requests. The deadline was triggered when EPA received the requests. “We haven’t heard what the DOE recommends,” he said. “It would be absolutely insane for DOE to recommend any of those hardship waivers. If there was no hardship in 2012, how can they claim that now? There’s no transparency in this process.”