Good morning!
Grain futures weaker overnight… At 6:00 a.m. CDT, December corn was down 1 3/4 cents. November soybeans were off 1 1/4 cents. September soybean meal was down $2.30 and September bean oil was 98 points higher and hit a five-week high. December SRW wheat was steady and HRW wheat was 2 1/4 cents higher. The grain futures markets are seeing a late-week pause, some profit taking from the shorter-term traders and some technical chart consolidation following recent gains. Grain market bulls, and especially the bean bulls, are also at least somewhat concerned by comments by President Trump last night that China interfered in the 2020 U.S. elections. (See item below.) The key outside markets today see the U.S. dollar index near steady. August Nymex WTI crude oil prices are firmer and trading around $80.50 a barrel. The yield on the benchmark 10-year U.S. Treasury yield is presently 4.53%.
U.S., Iran continue their military strikes… Concerns are growing that the U.S. and Iran will intensify military hostilities, with the sides clashing for a sixth straight day and Tehran refusing to back down over the Strait of Hormuz. The U.S. hit southern Iran overnight, striking six road bridges, and Iran responded by firing on U.S. bases in Kuwait, Jordan and Bahrain, and on Oman’s As Salamah Archipelago. China and Pakistan expressed concern over the developments, calling on both the U.S. and Iran to cease hostilities and resume dialogue, as analysts warn of a potential escalation spiral and increased clashes.
U.S. ag economy will weaken further in 2027: Farm Bureau… An American Farm Bureau Federation analysis shows U.S. ag economy losses are expected to deepen in 2027. “AFBF estimates that without federal assistance, farmers growing nine principal crops will lose $32 billion (national average returns over total costs) in 2027, compared to $31 billion in 2026. On a per-acre basis, every crop analyzed is projected to remain below breakeven in 2027,” said the study. “Additional economic assistance is needed and is supported on a bipartisan basis. Additional financial support is critical to offset trade-related losses, rising input costs and the deep financial pressure facing U.S. row crop, specialty crop, hay and sugar producers. This support would help stabilize the farm economy, sustain rural communities and maintain a strong domestic food supply,” said the report. “Longer term, policy solutions to help stabilize the farm economy are needed, such as year-round E15; a modernized five-year farm bill that protects interstate commerce from a patchwork of state legislation; a legislative fix to agricultural labor; and stronger risk management tools, including better data collection and publication to support more effective options for specialty crop producers.” For the complete report, click here.
Major Australian wheat region expected to see 30% production loss… An industry group expects the wheat crop in Australia’s largest grain-exporting state to shrink by almost 30% year-on-year, due to hot and dry conditions forecast over the next few months, Bloomberg reported. In its first survey of production for the 2026 crop, the Grain Industry Association of Western Australia forecast that the state will harvest 9.5 million tons of wheat. That’s down from 13.3 million tons in 2025. Overall grain production in Western Australia was estimated at 22.7 million tons, down from 27.4 million tons last year, according to the study that was published Friday. In its report, the association said the current Western Australian crop was looking “deceptively good” after an early start to the season and – until recently – warm winter growing conditions. However, that masked growing concerns about the weather forecast for the crucial spring months that lie ahead. “Most crops are carrying a lot of top growth and sub-optimal subsoil moisture reserves at the moment, which means that they will transpire themselves to death if the heat is turned up early and there is not enough rainfall to support this biomass,” the association said.
Total New World screwworm cases detected in U.S. holding at 39… The USDA Animal and Plant Health and Inspection Service (APHIS) on its NWS website is reporting 39 total New World screwworm detected cases in the U.S. and all still in Texas and New Mexico. There are 13 active cases, all still in Texas.
Lingering heat wave in Northern Plains, Great Lakes… The National Weather Service today said hot and humid conditions are expected to persist across the Great Lakes and Northern Plains for several days, with daily highs in the 90s to lower 100s expected. Air quality also remains a concern this weekend as a northwesterly flow continues to usher in smoke from Canadian wildfires toward the northeastern quarter of the nation. Meanwhile, another day of triple-digit high temperatures and elevated humidity is expected for the northern Mid-Atlantic today. Also along the northern-tier states, daily showers and thunderstorms will occur this weekend, some of which could produce scattered severe weather from the Ohio Valley into the Mid-Atlantic tomorrow. Monsoonal thunderstorms capable of isolated to scattered severe weather and flash flooding are forecast to track from north to south across the Four Corners region today and tomorrow.
Trump accuses China of meddling in 2020 U.S. elections, risking recent thaw… President Trump accused China of interfering with the U.S. elections in 2020, threatening to upend recently improved ties with the world’s second-biggest economy. Speaking in a prime-time address from the White House on Thursday night, Trump said the Chinese government stole 220 million voter files, including names, addresses and other sensitive data in what is “believed to be the largest compromise of election data in history” — claims that U.S. intelligence agencies have previously debunked, Bloomberg reported. Trump’s allegations risk derailing a fragile truce between the world’s two superpowers, just months after a May visit to Beijing in which he promised ties will be “better than ever before.” They also raise the stakes for a state visit by Chinese President Xi Jinping to the U.S. planned for September, the second of potentially four meetings between them this year, said Bloomberg. The Trump administration will also shorten the duration of visas for foreign journalists to 240 days, with mainland Chinese journalists getting 90 days. China’s Foreign Ministry spokesman said China “firmly rejects the U.S.'s discriminatory move” and reserves the right to take reciprocal countermeasures, said Bloomberg.
U.S. technology stocks tumble… U.S. equity futures fell overnight as a sell-off in semiconductor stocks gathered steam, pushing investors to look for alternatives in other corners of the market. Contracts on the tech-heavy Nasdaq 100 retreated 2.2%, while S&P 500 futures were down 1.1%. Nvidia Corp. led the Magnificent 7 group lower in premarket trading, while the Philadelphia Semiconductor Index was on the cusp of a bear market and set to extend Thursday’s losses. The chip sell-off was triggered by a surprise breakthrough from Chinese AI startup Moonshot, which said its Kimi K3 model could rival the strongest offerings from OpenAI and Anthropic PBC. Investors drew parallels with last year’s “DeepSeek moment.” China President Xi Jinping at a tech summit hailed his country’s progress in developing low-cost artificial intelligence and called for a more open technological order. Xi urged the world to adopt an inclusive approach to AI development, encouraging collaboration without rivalries and saying that safety risks must be contained. Meantime, U.S. executives are selling shares at the second-fastest pace in more than 20 years, a classic red flag to some investors because it suggests people with the most corporate knowledge are wary about markets. EPFR Global Market Intelligence data shows corporate insiders sold $77.6 billion of stock during the first half of 2026, a 20% increase from a year ago, Bloomberg reported.
Eurozone inflation also cooling… Following tamer U.S. consumer and producer price readings earlier this week, Eurozone annual inflation today was reported at 2.8% in June, down from 3.2% in May, year-on-year, and marking its lowest level since February. While inflation continued to ease, it remained above the European Central Bank’s 2.0% target. Energy inflation slowed to 8.5% from 10.8%, while price growth also moderated for services, non-energy industrial goods, and food, alcohol, and tobacco. EU core inflation, which excludes energy and food, eased to 2.4% from 2.6% annually. Among the bloc’s largest economies, inflation slowed in Germany, France, Italy, and the Netherlands, while remaining unchanged at 3.6% in Spain.
Malaysian palm oil futures weaker… Malaysian palm oil futures edged lower Friday, hovering below MYR 4,600 per MT after recent gains amid softer edible oil prices on the Dalian markets. Demand concerns also pressured risk appetite, as palm oil imports by top buyer India fell to a 14-month low in June after a narrower discount to rival oils curbed purchases. Meanwhile, China’s economy grew at its slowest pace since late 2022 in Q2, raising concerns over demand from another key importer. Despite the pullback, the contract remained on track for its first weekly gain in four, up about 1.7%, lifted by improving export prospects. Cargo surveyors noted palm oil shipments during July 1-15 rose between 4% and 12.4% from the same period in June. Meanwhile, Malaysia raised its August crude palm oil reference price, keeping the export duty at 10%. Crude oil prices also stayed elevated amid limited flows through the Strait of Hormuz as the U.S. and Iran intensified attacks, lending support to palm oil through stronger biodiesel demand.
Train-wreck in cattle futures markets… August live cattle on Thursday fell $3.05 to $227.075 and hit a four-month low. August feeders lost $3.35 to $346.60 and hit a five-week low. The cattle futures markets saw heavy technical selling pressure amid price downtrends firmly in place on the daily bar charts for both markets. Slumping cash cattle prices recently are also negative for futures. In the Northern Plains, persistently excessive heat has been severely stressing livestock. USDA’s Animal and Plant Health and Inspection Service (APHIS) on its NWS website is reporting 39 total New World screwworm detected cases in the U.S. There are 13 active cases, all still in Texas. USDA at midday Thursday reported more active cash cattle trading taking place, with steers fetching $239.51 and heifers $238.66. The agency on Monday reported last week’s cash cattle trading averaged $248.01, down $7.11. from the week prior.
Lean hog futures hit six-week high… August lean hogs on Thursday fell $0.05 to $100.275, near mid-range and hit a six-week high early on. The lean hog futures market saw mild follow-through technical buying from the speculators in early session trading, as a price uptrend remains in place on the daily bar chart. Some mild profit-taking from specs did temper gains by the close. Bullish futures traders are encouraged by recently rising cash hog prices. The latest CME lean hog index is up 73 cents to $94.60. Today’s projected CME index price is up 50 cents at $95.10. The national direct five-day rolling average cash hog price quote for Thursday was $99.62.