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Senior Contributor

OptionEye - Macro Outlook - Aug 3rd

Good morning. 

 

Overnight grains take a hit. 

 

Corn down 5, beans down 8 and wheat down 6. 

 

I took a long trip this weekend from NW Indiana to NW Illinois/NE Iowa. I was surprised on how good things looked. While I can appreciate the water damage earlier in the cycle, this was my first real look at the crop and it looked a lot better than what I thought I was going to see. That doesn't mean we can't rally in the short term here but make sure you are locked and loaded when it happens. 

 

More and more rate hike talk this month about a September rate rise will keep the dollar strong. The 10 year yield is weaker saying other wise. This morning it sits at 2.19% down from the mid to high 2.30%'s. 

 

Stocks are lackluster this morning and point to a relatively flat opening. The S & P future is just a half a point higher this morning. 

 

Oil is lower again to $46.50 down .62 cents. Gold is lower by $2.59 to $1093.23.

 

Big week this week as we get unemployment numbers on Friday. Today we get Personal Income, PCE, Markit US Manufacturing PMI, Construction Spending and ISM Manufacturing. 

 

Have a great day.

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10 Replies
Frequent Contributor

Re: OptionEye - Macro Outlook - Aug 3rd

Some good some bad , do a flyover
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Veteran Advisor

Re: OptionEye - Macro Outlook - Aug 3rd

Scott, you are right about one thing, NE Iowa crops look great, could break a few farm records even. Close to 100 miles of poor looking crops along I-80 in Illinois, from Chicago through eastern Bureau county. The northern Indiana crop looks nearly as good as Iowa crops this year. The damage in Indiana starts south of Ft Wayne. Take I-69 to Indy if you get the chance Scott, you wouldn't be as quick to sell anything after that. Already I'm seeing some plus basis in NE Indiana. I've got about 2,000 miles of crop tour under my belt in July and August, and I don't think the trade is trading reality on the new crop side of things, at least for now. Thank you for the reporting that you and Mike do from day to day!

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Senior Advisor

Re: OptionEye - Macro Outlook - Aug 3rd

60 mph crop scouting is going to get a lot of people in trouble come harvest time

 

Course you probably already knew that

 

Get up in the air and then ground truth it

 

Also, kernel counts coming in light and I still contend kernels are coming in shallow too

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Veteran Advisor

Re: Bout the only thing that can "ding" the record crops in

the West / NW cornbelt would be a Rare early frost ( say end of Aug / 1st part of Sept.). Iowa should have a record crop, and Minnesota should 2. Nebraska should be average. same for SoDak ( northern dakota got nipped by a couple late frosts after planting ). NoDak should be real good too. get South of those States....and there ain't much good corn or beans either 1. East of the Mississippi River States gonna have to carry the Total Deal to make a Decent High Average USA Total corn/bean crop.
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Honored Advisor

Re: OptionEye - Macro Outlook - Aug 3rd

Just as well accept the fact there is a great crop within a hours drive of Chi town. 

 

There is a large area of great crops, I'm sure we will have enough for everyone, some of you will just need to get a truck and come get it.

 

At the rate this crop is recovering (according to the experts in Chicago) about half way through harvest you shoud be able to just show up with a truck out in the fields and they'll load it for you just to get rid of it. Maybe even longer seeing as many are the better part of full from last year and its Aug. 

 

Most likely most of it is a triple stack hybrid... just means three ears per stalk. Going to take at least two years to get it all harvested and hauled out of here. 

 

Warren Buffet has to just love this. He owns Brock/Butler grain bin mfg and a railroad here. Going to make it whether we store it or ship it.

 

Just can't make this stuff up, fact is stranger than fiction.

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Veteran Advisor

Re: OptionEye - Macro Outlook - Aug 3rd

We'll know it's a big crop when it gets delivered 1 ear at a time on pickups and flatbed wagons, or 3 ears at a time on hay-bale trailers.  Or, when the ears are all lined up at the edges of the fields, waiting for the loggers to come and pick them up.

 

Image result for world's largest ear of corn olivia minnesota

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Advisor

Re: OptionEye - Macro Outlook - Aug 3rd

Wcmo-have any idea on kernel counts on that ear? I hear that is representative of most of this year's crop, at least according to the traders. I am sure glad the traders do not raise the corn themselves as no telling how high the yields would be.
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Veteran Advisor

Re: OptionEye - Macro Outlook - Aug 3rd

Damned if you did and damned if you don't.  Smiley Happy

 

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Senior Contributor

Re: OptionEye - Macro Outlook - Aug 3rd

Big crops use lots of moisture which we are runnin short of here. Eggs are not even cracked yet nor is the pan hot.

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