Top 5 Key Market Movers to Watch the week of September 24

Sep 21, 2023

This week there are 5 key reports to watch that could have significant impacts on commodity markets the week of September 24, 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.

By Colin McNaughton
Farms.com Risk Management Intern

1. USDA’s Crop progress report will be released on Monday, September 25th. The recent report showed that U.S. corn areas are still battling dry conditions Twenty percent of corn is considered very poor-poor, a 2% increase from the prior week. Soybeans remained at 18% very poor-poor, seeing no change over the week. Illinois saw a 6% increase in very poor-poor conditions, jumping from 16% up to 22%. Any rain that falls now is too late but can help replenish soil moisture for next year's growing season.

2. The upcoming week's reports include the USDA grains inspected for exports report on Monday, September 25th, EIA ethanol data on Wednesday, September 27th, and the USDA weekly export sales report on Thursday, September 28th. Demand remains weak and the funds are concerned as they keep selling the grains, but its also that time of the year seasonally where we are trying to form a bottom.

Corn inspections were strong as 642,000 mt were inspected. That number comes in higher than both last week and this week last year at 549,000 mt. Soybeans inspections came in at 393,000 mt, noticeably lower than last year's 521,000 mt. The start of this marketing year for corn is showing some positive signs that it can be better than the last which lacked in comparison to the prior year.

3. Despite rains in the Midwest, the U.S. drought monitor map worsened as now 78% of the Midwest is affected by at least D0 drought conditions, up 9% from last week. North/Eastern Iowa saw the emergence of D4 drought conditions, leaving 4.96% of the state in D4 drought. Iowa did not see any D4 drought conditions throughout the entire summer.

The USDA/NOAA Ag in Drought report showed that 58% of U.S. corn and 53% of soybeans are suffering from at least D1 drought conditions. The U.S. Midwest has seen 0 moisture in the last 30 days resulting in a very poor/dry/fast finish which usually results in lower yields by as much as 10%, as grain fill is impacted. Crops west of Indiana were brown layering instead of black layering and adding yield. At the end of August, crops were dying, not drying down!

4. USDA’s quarterly Grain Stocks report will be released on Friday, September 29th. The June report showed most grains stored were down from 2022. Corn stored in all positions was down 6% from the prior year, soybeans were down 18%, and all wheat was down 17%. This report can be market moving, particularly in corn, and provide a bullish surprise as stronger U.S. basis in 2022 suggests that the USDA overestimated both the U.S. corn and soybean crops at 173.3 and 49.5 bpa respectively.

5. The USDA quarterly Hogs and Pigs report will be released on Thursday, September 28th. The June report showed the U.S inventory of all hogs and pigs on June 1st, 2023, was 72.4 million head. This number was slightly down from the March report which came in at 72.9 million head. The Market hog inventory came in at 66.2 million head, down 1 percent from the March report. Pigs saved per litter surprised with a 3.3% growth. Many are looking to see if this report shows further liquidation in the industry as hog weights are down 9 lbs vs. last year and sow slaughter continues to rise.

For daily information and updates on agriculture commodity marketing and price risk management for North American farmers, producers, and agribusiness visit the Farms.com Risk Management Website to subscribe to the program.

Video: The 15-Year Bet Behind Every New Variety!

Canada is trying to decide how much agricultural research capacity it can afford to lose. Brian Rossnagel believes the better question is whether the country can afford to rebuild it.

The longtime barley and oat breeder makes the case with a simple fact about his profession: the consequences of today’s decisions may not become visible for 10 or 15 years.

“Pick the right parents. That’s the biggest thing,” Rossnagel says. “If you pick the wrong parents, you’re not going to get anywhere—and you don’t know that until 10 years, 15 years later.”

That warning carries particular weight as Agriculture and Agri-Food Canada moves to reduce spending and streamline parts of its science operations. The department’s 2026–27 plan anticipates the loss of approximately 665 positions by 2028–29 and says some research will be reduced where capacity exists in academia or industry. AAFC says the changes will make its science operations more cost-effective over the long term.

For Canada’s seed industry, Rossnagel’s career illustrates what is at stake.

This fall, the retired University of Saskatchewan breeder will be inducted into the Canadian Agricultural Hall of Fame. During his 35-year career at the Crop Development Centre, he helped develop more than 100 barley and oat varieties, including CDC Austenson—one of Western Canada’s most widely grown feed barleys. His induction recognizes not only those varieties, but the collaboration and research system that made them possible.

Rossnagel is quick to emphasize that none of it was the work of one person.

“The first thing I thought about was all the other people who contributed to whatever success I and my program had over the years,” he says. “We know that it’s not an individual who does this. It’s a group—a team.”

That team extends well beyond the breeder whose name appears beside a variety. It includes technicians, pathologists, quality specialists, statisticians, regional testing sites, seed growers and industry partners. It also includes the breeders who came before and those who will carry the germplasm forward.

CDC Fraser barley, for example, moved through three breeding careers. Its parents came from Brian Harvey’s program. Rossnagel advanced the material after Harvey retired, and Aaron Beattie later guided it through registration and release.

That kind of handoff is normal in plant breeding. The person who makes the original cross may never see the resulting variety reach farmers.

It also explains why lost research capacity cannot simply be switched back on when budgets improve.

“If you shut it off, it’s very, very difficult—and particularly costly—to start it up again,” Rossnagel says. “If you have to start from scratch, it’s going to be at least 10 years before anybody notices whether you’re getting anything done or not.”

The concern is not simply how many experimental lines Canada can process. Modern equipment, statistical tools and genetic technologies allow today’s breeding programs to evaluate tens of thousands of lines—far more than Rossnagel could handle when he entered the field in the early 1970s.

But efficiency and automation do not generate every idea.

“If you pare back down, and instead of having six or seven individual scientists concentrating on wheat breeding, you go down and say three people could handle all this, well, that’s half the ideas gone,” he says. “Particularly if you happen to lose the three people who had the really neat and innovative ideas, boy, that’s a problem.”

It is a timely distinction for Canadian agriculture. Consolidating programs may preserve the volume of material moving through a system, at least initially. It may not preserve the diversity of thinking, regional knowledge or willingness to pursue unconventional crosses.

That regional knowledge matters because Canadian agriculture is not one uniform production environment. A variety suited to southern Alberta may face different disease, moisture and maturity pressures than one grown in Manitoba, Ontario or Atlantic Canada.

“Agriculture is applied biology,” Rossnagel says. “Biology, all around the Earth, moves from the poles to the equator. It does not move from Newfoundland to B.C. like politics do.”