Corn futures at Chicago succumb to profit taking overnight after some good gains in the prior session. Talk of 5-10mt of corn getting taken out of the production side in the US saw futures higher Thursday. Looking at the size of the US crop, 388mt, 5-10mt represents less than 4% of the entire crop at best and some of that area may have been allocated to be cut for silage anyway. The US has a traditional number of roughly 9.5% of the corn crop not getting harvested as grain.
With corn futures lower at Chicago wheat done well to see small gains in the SRW contract and minimal losses for HRW and DNS wheat. In the US grains are cheap at a domestic level, corn producers will struggle to make a profit if yields are lower than average. This is likely to see sales pace slow and may signal higher ending stocks as we move into the new year. Much the same can be said for lower grade wheat in the USA. The increased purchase pace from China is well worth watching though, in the words of Georgie Chew, owner of the Dragon Phoenix Restaurant at Moree in the 90’s, when rumoured to have been caught in a compromising position, “it not look what it like”.
Heatwave conditions across the UK and Europe pushed the corn crop condition rating lower. The French corn crop slipped a massive 9% this week from 74% G/E to 65%. According to my distant cousin in Cardiff, who would you believe has the same name as me, they were dying when the mercury pushed as high as 35C…..  On the 11th there were locations in France that topped out at 40C with almost the entire central districts of France pushing above 35C.
Rainfall across the Canadian Prairies has been a little light on over the last week, with wheat 50% turned it’s not a huge problem.