This week there are 5 key reports to watch that could have significant impacts on commodity markets the week of August 21, 2023.
This Farms.com column tracks key events in commodity marketing impacting the agriculture industry. The series of article shares issues to watch the following week, issues that may have an impact on commodity prices in the coming weeks.
Colin McNaughton
Farms.com Risk Management
1. The weekly USDA crop progress report will be released on Monday, August 21st. The recent crop progress report showed an improvement across the U.S. in soybean/corn conditions, as well as subsoil and topsoil moisture levels. Overall corn and soybean very poor-poor rating decreased by 1% and 2% respectively, and now sit at 13% and 12%. Eyes were on Illinois beans as good-excellent conditions rose by 12% up to 70%. All three of the “i” states saw an improvement in subsoil moisture levels. Illinois, Indiana, and Iowa very poor-poor levels shrank by 2%, 9%, and 3% respectively, and now sit at 31%, 31%, and 63%. With the intense heat expected during the weekend, crop conditions are unlikely to see the same level of improvement in next week’s report.
2. Next week’s weekly reports will include the USDA grains inspected for export on Monday, August 21st, EIA ethanol data on Wednesday, August 23rd, and the USDA weekly export sales on Thursday, August 24th. The grains inspected for exports have been improving week by week, yet we are nowhere near last year’s numbers. Recently, we saw an increase in corn inspections vs. the prior last week, 398,000 MT from 387,000 MT, while last year’s number was at 535,000 MT. Soybeans were marginally above the prior week, 297,000 MT from 284,000 MT, while not even in the same ball park as last year’s 768,000 MT. The total grains inspected came in just below the prior week’s total, largely due to the decrease in wheat exports. Although we are still far away from last year’s figures, there have been a string of positive reports over the last few weeks which show a step in the right direction.
3.The U.S. drought monitor map will be updated on Thursday, August 24th. The recent update showed general improvements when looking at the U.S. with 49.56% unaffected by drought. With a continued focus on the “i” states, Illinois saw a 12.6% decrease in D1 drought and 13.9% drop in D0. Indiana is now down to just 9.72% affected by drought, with no area above D0. Iowa is below 100% affected by drought for the first time since July 4th. According to the USDA, 42% of corn and 38% of soybeans remain in drought, down 7% and 5% from last week, respectively. Due to intense heat and dryness expected for the next couple of weeks, the drought % may increase.
4. USDA’s monthly cold storage report will be released on Wednesday, August 23rd. Last month’s report showed a decrease in total red meat in storage when compared to the prior month. Total beef sat at 97% of May 2023 and just 80% of June 2022. Total pork was 92% of May 23 and 91% of June 22. Leaving the total frozen red meat number at 94% of the prior month and 86% of the prior year.
5. We will see many economic reports from the U.S. and Canada next week. U.S. reports include the initial jobless claims on the 24th, existing and new home sales on the 22nd and 23rd, as well as the services PMI on the 23rd. For Canada, we have the new housing price index on the 21st and retail sales data on the 23rd. These reports come at an important time as in both countries, CPI increased from the prior month, putting the downward trend on pause. U.S. inflation was pegged at 3.2%, up from 3.0% in June, while in Canada it was 3.3%, up from 2.8% in June.
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