Drought Expanding South Of The Border

Jun 10, 2021

Crops in the U.S. are looking OK for now, however drought continues to expand.

Ben Buckner is a grains analyst with AgResource Company.

"Moisture demand is not very high and soil moisture, up until maybe the middle part of May, was OK. It's changing very quickly. We're hearing of some water use rates of half to 6/10ths of an inch per day, which you can't even offset with irrigation. Drought continues to expand, will expand further assuming two week forecasts verify. The real message is that moisture accumulation so far, since about late winter, has been on pace with 2012, which if you remember was a devastating drought in the U.S. I don't think widespread catastrophe is the most probable scenario, but crops will be going backwards over the next 2 weeks and the big question is whether July weather improves."

The USDA released its June WASDE report Thursday. Buckner says the report came across mostly as expected.

Click here to see more...

Video: U.S.-China Trade “Truce” + U.S. Fed Cuts Rates Again

The market was hoping for a US-China trade deal, but we got a trade “truce” for now from the keenly awaited Trump-Xi meeting at the APEC Summit.
China commits to minimum purchase commitments of 12 MMT of U.S. soybeans during the “current season” and a minimum of 25 MMT annually through 2028.
U.S. Treasury Sec Bessent said other Asian countries have agreed to buy additional 19 MMT of US soybean.
Soybean futures trading above $11 now- they normally tend to rally to $12.
As expected, US Fed cuts interest rates by -0.25% again in October to 3.75%–4.00%. No further cuts promised for this year but trade looking out to the Dec FOMC.
The Bank of Canada cut interest rates to 2.25% but raised concern over trade war damage.
Soy meal futures, remarkably, have had 14 consecutive higher close sessions. A bull market in soybeans is a bull market in soy meal!
Cattle futures lower as funds unwind out of cattle for now due to Trump headlines and objective to lower beef prices.
All major stock indices climb to new record highs. It was Mag 7 reporting week, which had mixed results. But we now have the first $5 trillion company in Nvidia!