By Kirk Maltais
--Soybeans for November delivery fell 1.3% to $13.45 a bushel on the Chicago Board of Trade on Tuesday, with the market reacting to gains in the U.S. Dollar Index while digesting the implications of the Pro Farmer Midwest Crop Tour's findings and hot weather this week.
--Corn for December delivery fell 0.7% to $4.79 1/2 a bushel.
--Wheat for December delivery rose 0.4% to $6.29 a bushel.
HIGHLIGHTS
Swinging Weight Around: Traders were concerned that the dollar's strength could affect U.S. export demand. The U.S. Dollar Index rose 0.3%. "It's not Pro Farmer's findings, but rather macro market weight, with the U.S. Dollar Index finding a newer 11-week high, which pulls money from global raw material markets," AgResource said in a note.
Maintaining the Trend: Tuesday's trade mimicked action seen in Monday's session. "Maybe the handwriting was on the wall yesterday as corn and beans had plenty of bullish weather news to rally, but beans posted just meager gains and corn was down double digits," said Joel Karlin of Ocean State Research. "Anytime you get some positive fundamental news and the market does not respond in a bullish fashion, that's always a big red flag." News from the Pro Farmer Crop Tour showing crops withstanding hot and dry conditions seen for much of the summer was also a source of pressure, Karlin said.
INSIGHT
Bouncing Back: The first day of the Pro Farmer Crop Tour showed an uptick in production based on the surveyed fields, suggesting that some well-timed rains have averted another tough drought year in many growing areas. Estimates pegged Ohio corn yields at 183.9 bushels per acre, versus 174.2 bushels per acre reported last year and a five-year average of 175.6 bushels per acre. Soybean pod counts for the state also exceeded last year's and the five-year average. In South Dakota, corn yields have surged back after being drought-stricken last year, hitting 157.4 bushels per acre, versus 118.4 bushels an acre last year. Hot temperatures have returned to South Dakota this week, but corn looks to be mature enough to withstand that pressure and finish. "We found the foundation for a good corn crop in South Dakota," said Chip Flory of Pro Farmer.
Changing Course: Hot weather has set back crops in some growing areas, according to the USDA. Corn in good or excellent condition fell one point in this week's report to 58%, while soybeans were unchanged at 59% and spring wheat slid 4 points to 38%.
Reaching for the Stars: At 92.1 million metric tons, Russia's wheat crop looks to hit its second-highest level in history, eclipsed only by last year's record high of 104.2 million tons, SovEcon said in a note. "The impressive Russian crop, combined with record stocks, will stimulate exports and exert pressure on global prices," the firm said. "However, raising the overall grain supply estimate won't significantly increase export projections due to Russia's infrastructure constraints."
AHEAD
--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.
--The USDA will release its monthly Cold Storage report at 3 p.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.
--The U.S. Drought Monitor will release its updated map at 8:30 a.m. ET Thursday.
--The USDA will release its monthly Livestock Slaughter report at 3 p.m. ET Thursday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
08-22-23 1533ET
