Good morning!
Grains mildly weaker this morning... Corn, soybeans and wheat traded on both sides of unchanged during the overnight session but are mildly weaker early this morning. As of 6:30 a.m. CT, corn and soybean futures are trading around a penny lower and wheat futures are mostly 1 to 3 cents lower. The U.S. dollar index is around 140 points higher and front-month crude oil futures are about 65 cents higher.
July crop reports out later this morning... USDA will issue its first all-wheat crop production estimate in the Crop Production Report at 11:00 a.m. CT. In the Supply & Demand Report, old-crop balance sheets will reflect June 1 stocks, which were final 2024-25 ending stocks for wheat, along any changes to usage forecasts. The new-crop balance sheets will feature USDA’s June acreage estimates, along with adjustments to projected 2025-26 use. All wheat production is expected to be 1.915 billion bu. (1.921 billion bu. in June). Ending stocks are expected at – corn: 1.353 billion bu. for 2024-25 (1.365 billion bu. in June); 1.720 billion bu. for 2025-26 (1.750 billion bu. in June); soybeans: 358 million bu. for 2024-25 (350 million bu. in June); 302 million bu. for 2025-26 (295 million bu. in June); wheat: 851 million bu. for 2024-25 (set by June 1 stocks); 895 million bu. for 2025-26 (898 million bu. in June); and cotton: 4.43 million bales for 2025-26 (4.3 million bales in June).
China makes no changes to balance sheets... China’s ag ministry made no changes to its corn, soybean or cotton balance sheets this month. “The domestic corn supply is relatively sufficient, demand remains high and the market shows a tight supply-demand balance,” it said. In Northeast China, favorable soil moisture and climate are supporting healthy soybean growth, while late-June rainfall in areas such as Henan and Shandong provinces eased earlier drought conditions, it added.
U.S. to impose 35% tariff on Canadian imports, exempting USMCA goods for now... President Donald Trump announced Thursday evening the U.S. will impose a 35% tariff on imports from Canada, effective Aug. 1. An exclusion for goods covered by the United States-Mexico-Canada Agreement (USMCA) on trade was expected to stay in place and 10% tariffs on energy and fertilizer were also not set to change, though Trump had not made a final decision on those issues, an administration official said.
High odds for Trump/Xi summit after ‘constructive’ U.S./China talks... Secretary of State Marco Rubio said the likelihood of a summit between President Donald Trump and Chinese President Xi Jinping later this year is “high,” following what he called “very constructive and positive” talks with Chinese Foreign Minister Wang Yi in Kuala Lumpur. This marks the first in-person meeting between the two diplomats since Rubio took office in January. While major disagreements remain, both sides highlighted potential areas for cooperation as well as continued challenges in the U.S./China relationship.
Washington renews focus on Indo-Pacific region amid rising trade concerns... Rubio’s first trip to Asia since taking office is part of an effort to renew U.S. focus on the Indo-Pacific region. Rubio also met Japan’s foreign minister and South Korea’s first vice foreign minister in Malaysia on the sidelines of the Association of Southeast Asian Nations (ASEAN) summit to discuss regional security and a strengthening of their “indispensable trilateral partnership” in areas such as critical technologies and supply chains, a U.S. State Department statement said. In a joint communique on Friday, ASEAN foreign ministers expressed concern over rising global trade tensions and uncertainties. Without mentioning the U.S., they said unilateral tariffs were “counterproductive and risk exacerbating global economic fragmentation,” echoing a previous statement by ASEAN leaders in May. They also emphasized a need to diversify trade with new and emerging partners and called for a transparent and fair multilateral trading system.
Union Pacific to open new Kansas City intermodal terminal July 15... Union Pacific Railroad (UP) will open its new Kansas City, Kansas, intermodal terminal on July 15, offering 30% more lift capacity than the facility it replaces. The upgraded terminal, located about 10 miles from the current site, features direct highway access, stacked container operations, more parking, expanded rail tracks, widened roads and automated gates. It will handle both domestic and international containerized grain shipments. This new Kansas City ramp is UP’s fourth recent major terminal, following similar projects in Phoenix, Minneapolis and Southern California’s Inland Empire.
Walmart opens $257 million beef facility in Kansas... Walmart has launched its first fully owned beef packaging and distribution plant in Olathe, Kansas, a $257 million investment aimed at strengthening its control over the Angus beef supply chain. The 300,000-square-foot facility, supplied exclusively by Sustainable Beef LLC, is expected to serve more than 600 Walmart stores across 14 Midwestern states. The new operation marks a significant step in Walmart’s strategy to deliver higher quality, traceable and affordable beef while supporting local ranchers. By directly sourcing and packaging beef, Walmart says it can provide greater consistency and transparency, meeting rising consumer demand for responsibly sourced food.
Japan nearing resumption of beef exports to China after 24-year hiatus... Japan’s ag ministry said an animal health and quarantine agreement with China paves the way toward the resumption of Japanese beef exports to China that have been restricted since September 2001 due to an outbreak of bovine spongiform encephalopathy. A Japanese government official said it’s unclear when exports could start.
Key day for cattle futures... August live cattle futures posted a bearish key reversal on Thursday, ending with an outside day down after hitting a contract high earlier in the session. The contract is still up sharply for the week, but active followthrough selling could lead to an extended corrective pullback and may pressure cash cattle prices. Given the steep discount to the cash market, traders may continue to view price breaks as a buying opportunity.
Cash hog index slide halted... The CME lean hog index is up a dime to $107.14 as of July 9, ending a seven-day skid that saw prices fall $4.98. July lean hog futures, which expire next Tuesday and are settled against the cash index on July 17, finished 11 cents above today’s cash quote. August hogs finished Thursday at a 91.5-cent discount to the cash index.
Overnight demand news... Pakistan tendered to buy 300,000 to 500,000 MT of optional origin white refined sugar.
Today’s reports
- 11:00 a.m. Crop Production NASS
- 11:00 a.m. World Agricultural Supply and Demand Estimates Reports (WASDE) — WAOB
- 11:15 a.m. Cotton: World Markets and Trade — FAS
- 11:15 a.m. Grains: World Markets and Trade — FAS
- 11:15 a.m. Oilseeds: World Markets and Trade — FAS
- 11:15 a.m. World Agricultural Production — FAS
- 2:00 p.m. Mink — NASS
- 2:00 p.m. Peanut Prices — NASS
- 2:30 p.m. Commitments of Traders — CFTC