Will employment numbers or Russian weather have more of an impact on commodity markets this week?
This week there are 4 key reports to watch and the weather in Russia that could have significant impacts on commodity markets the week of August 5, 2024. This Farms.com column tracks key events in commodity marketing impacting the agriculture industry! The series of article shares issues to watch the following week, issues that may have an impact on commodity prices in the coming weeks.
By Devin Lashley
1. The USDA Crop Progress Report comes out Monday, August 5th and will likely show further stagnation in crop conditions and quality as U.S. corn conditions fell one point this week with a cool/wet forecast for the first half of August. Soybean conditions remained unchanged.
U.S. crop ratings improved in July, pointing to a stress-free corn pollination period, with a cool/wet July and timely rains it suggests a USDA corn yield estimate in the August crop report that is higher than 181 bpa.
2. Next week's Weather Forecast in Russia sees heat and dryness returning as a ridge of high pressure moves eastwards from Poland and central Europe. Temperatures could see high 90s degrees Celsius and possibly into the early 100s, although it’s not as bad as the previous heatwave, Russia has been hot and dry for a while now and is in desperate need of moisture.
3. The USDA Drought Monitor comes out Thursday, August 8th and will likely show stagnation if not mild depreciation of droughts across major growing regions. The Midwest is expected to get a healthy mix of rain and sunshine, forecasted precipitation in the eastern Midwest especially in Ohio should help as that’s where a majority of droughts and dryness in the Midwest are situated.
4. The USMEF Monthly Meat Exports data will be released Wednesday, August 7th and will likely show a continued decline in volume as exports have started to struggle. In May, U.S. beef exports hit $902.4 million, the highest since June 2023, despite a 5 percent drop in volume. For January to May, beef export value rose 5 percent to $4.29 billion.
Pork exports in May were 4 percent lower in volume, valued at $715.8 million. However, January to May pork exports increased 6 percent in volume and 7 percent in value to $3.6 billion.
5. The U.S. Initial Jobless Claims data comes out on Thursday, August 8th and will likely show a continued cooling of the U.S. labor market. As the economy comes back to some form of normalcy, monthly job gains have slowed, but remained steady. It is likely the jobless claims will somewhat reflect that change, likely increasing.
Last week, new unemployment claims in the U.S. hit an 11-month high, indicating a potential labor market softening. Mid-July saw the highest jobless roll numbers since late 2021. This data may heighten fears of rapid labor market decline and recession fears, especially after June's unemployment rate rose to 4.1 percent, a 2.5-year high.
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