Evening Report | July 17, 2023

Evening Report
Evening Report
(Pro Farmer)

Check our advice monitor on ProFarmer.com for updates to our marketing plan.

 

Corn conditions improve as expected... As of Sunday, USDA rated 57% of the corn crop as “good” to “excellent,” up two percentage points from last week and in line with expectations. The amount of crop rated “poor” to “very poor” declined one point to 13%.

 

This week

Last week

Year-ago

Very poor

4

4

3

Poor

9

10

8

Fair

30

31

25

Good

46

45

51

Excellent

11

10

13

Crop development continues to run a little ahead of average with 47% silking (43% on average) and 7% in dough (6%).

 

Soybean conditions improve more than expected... USDA rated 55% of the soybean crop as “good” to “excellent,” up four points from last week. Traders expected a two-point increase. The portion of crop rated “poor” to “very poor” declined two points to 13%.  

 

This week

Last week

Year-ago

Very poor

4

4

3

Poor

9

11

7

Fair

32

34

29

Good

47

44

51

Excellent

8

7

10

USDA reported 56% of the soybean crop was blooming (51% on average) and 20% was setting pods (17%).

 

Cotton conditions decline... USDA rated 45% of the cotton crop as “good” to “excellent,” down three points from the previous week. The portion of crop rated “poor” to “very poor” increased three points to 28%. In Texas, USDA rated 26% in the top two categories and 45% in the bottom two.

 

This week

Last week

Year-ago

Very poor

12

9

15

Poor

16

16

12

Fair

27

27

35

Good

38

41

34

Excellent

7

7

4

USDA reported 64% of the cotton crop was squaring (69% on average) and 25% was setting bolls (26%).
 


Spring wheat condition improves... USDA rated 51% of the U.S. spring wheat crop as “good” to “excellent,” up four points from the previous week, whereas traders expected no change. The portion of crop rated “poor” to “very poor” declined two points to 14%. The North Dakota crop was rated 51% “good” to “excellent” and 15% “poor” to “very poor.”

 

This week

Last week

Year-ago

Very poor

3

4

1

Poor

11

12

5

Fair

35

37

23

Good

48

45

61

Excellent

3

2

10

The spring wheat crop was 86% headed, three points ahead of average. In North Dakota, 79% of the crop was headed, four points behind average.

 

Winter wheat harvest passes halfway point... As of Sunday, USDA reported 56% of the U.S. winter wheat crop had been cut, up 10 points from the previous week but 13 points behind average. Harvest stood at 97% in Texas (98% on average), 97% in Oklahoma (100%), 71% in Kansas (94%) 20% in Colorado (60%) and 21% in Nebraska (52%). SRW wheat harvest was generally at or slightly ahead of average.

 

NOPA crush falls to nine-month low... Members of the National Oilseed Processors Association (NOPA) crushed 165.0 million bu. of soybeans during June, which was down 7.2% from May and the lowest level since September 2022. Analysts expected the crush pace to total 170.6 million bushels.

NOPA data implies a full June crush of about 176 million bushels. At that level, crush through the first 10 months of 2022-23 would total 1.859 billion bu., up 0.7% from the same period last year. To reach USDA’s forecast of 2.220 billion bu., crush must run 0.3% ahead of the final two months last year.

Soyoil stocks totaled 1.690 billion lbs. at the end of June, a seven-month low and down 182 million lbs. from May and 77 million lbs. below last year.   

 

Massachusetts livestock conditions law delayed... The enforcement of a Massachusetts state law (Question 3) necessitating suitable living conditions for livestock has been delayed until Aug. 23 due to an ongoing lawsuit. The law instructs farmers to grant enough space for veal calves, breeding sows, and egg-laying hens to maneuver and extend their limbs. This announcement came as parties involved, including state officials, the restaurant and pork industries, require more time to assess outstanding issues following the Supreme Court’s upholding of a similar California law, Proposition 12, in May.

The extension was approved by U.S. district judge Margaret Guzman to allow for further consultations and possible settlement negotiations. The Massachusetts suit, like the one taken to the Supreme Court, challenged the constitutionality of the animal welfare standards established by a 2016 referendum, known as Question 3.

Following the Supreme Court’s decision, the National Pork Producers Council (NPPC) stated that Massachusetts could define its own meat production standards. However, issues such as restrictions on shipping noncompliant pork products through Massachusetts to other New England states or other countries remain unsettled.

Question 3 not only establishes standards for Massachusetts farmers but also prohibits the sale of goods from other states unless they abide by Massachusetts’ regulations. According to NPPC, this creates additional obstacles in the pork supply chain by preventing the transportation of noncompliant pork through Massachusetts for delivery to other locations.

NPPC’s take: “This extended implementation allows the coalition and Massachusetts to continue discussions on implementation to ensure a smooth transition — including the transshipment and exports of pork through Massachusetts — so pork can continue to reach other New England states as well as provide guidance to the industry and supply chain. It is important to note that this Status Report and Joint Motion to Extend Stay does not change Q3, the rules, or what it means to be compliant. It simply extends the existing enforcement stay for a few more weeks.”

 

WOTUS update... EPA has requested court intervention in the Waters of the U.S. (WOTUS) issue as it prepares a new rule to replace its previous version. This follows a disruption caused by a U.S. Supreme Court decision earlier this summer. While EPA aims to present its new final rule for WOTUS before Sept. 1, the rule has not yet been submitted to the Office of Management and Budget (OMB) for review. OMB can take up to three months to review agency plans.

 

Tai to talk trade with Kenya, EU... U.S. Trade Representative Katherine Tai will be focusing on trade issues with Kenya this week during her three-day visit, which includes a meeting with the country’s president, William Ruto. This is in line with the Biden administration’s preference of using trade and investment framework agreements over free trade agreement (FTA) talks, a trend that was initiated under the Trump administration. After Kenya, Tai is scheduled to proceed to Brussels for a meeting with her European Union (EU) counterpart, Valdis Dombrovskis.

 

Economists less pessimistic toward U.S. economy... Economists have reduced their predictions of a potential U.S. recession in the upcoming year, with the estimated probability dropping to 54% from the earlier assessment of 61%, as per a recent poll conducted by the Wall Street Journal involving business and academic experts. This downward adjustment, which is the most significant monthly percentage-point decrease since August 2020, corresponds to several positive economic signals. Nearly 60% of economists said their main reason for more optimism about the economic outlook is their expectation that inflation will continue to slow, but robust labor market conditions, as well as the demonstrated economic resilience, also contributed to this reassessment. Despite the lower figure, the recession risk remains relatively high when compared to historical data.

 

Yellen: Ukraine support best way to help world economy... Treasury Secretary Janet Yellen stated on Sunday that intensifying support for Ukraine, currently embroiled in war, is the “single best” method of assisting the global economy. Yellen, who made these remarks at a G20 finance ministers’ summit in India, emphasized that she would resist any criticism suggesting a trade-off between aid to Ukraine and developing nations. Yellen highlighted ongoing endeavors to alleviate debt distress faced by struggling economies, implement bank reforms, establish a global tax deal, and cautioned that discussions about lifting tariffs on China are “premature.”

 

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