Daily Market Cast: 7/31

Daily Commentary: Friday, July 31, 2026

Transcript

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Hey everyone, this is Allison giving you today's Siddly Grain Market commentary for Friday, July 31st. And what a difference a week can make and a weather forecast that that can make. Grain futures ended the week under pressure, just with traders reducing risk ahead of month end and of course going into a weekend. And we've seen weather geopolitics really fueled a movement here over the last couple of weeks. And honestly, it came down to weather on the grain side. Beneficial rain, cooler near-term temperatures definitely helped pull a lot of that premium out going into the weekends. But rain did move through some key areas of the northwestern central corn belt here over the past 24 hours, but amounts and coverage vary, especially where it is dry. But overall, the market's looking at temperatures and they're expected to moderate, and that'll give corn and soybeans a much less stressful start to August than the market was expecting a week ago. So that explains the sell-off that we're seeing here, but it does not settle final production. The extended forecasts do turn warmer across much of the country with normal to below normal rainfall. Corn pollination may be near complete, but that grain and soybean pods still have filling ahead. So the immediate threat has eased, but it has by far not disappeared. And also, we're talking still about geopolitics here. Logistical problems in the Black Sea do remain unresolved. Yet we haven't seen global buyers really show any urgency in securing grain from alternative origins. So until that changes, geopolitics just may create some volatility without providing at least lasting support for now. Corn had bullish news overseas today, but the market just remained focused on improving U.S. weather. French corn is rated just 34% good to excellent, while European production estimates have fallen nearly 10 million metric tons from early projections. So that could eventually improve demand for U.S. corn, but it was not enough to slow this week's sell-off. Official managed money positions will be released after the close today, but we do suspect the net long has fallen sharply. Open interest did increase by more than 18,000 contracts yesterday, which does suggest that the pressure was not simply long with date liquidation. We are seeing some new shorts entering just as weather premiums coming out. So those positions could eventually fuel the move, but first the market needs to have a reason here to keep selling too. September corn closed five cents lower at 440 and three quarters. December settled four and a half cents lower at 464, both down 23 and a half cents for the week. And soybeans had plenty of supportive demand headlines here to finish the week too, but it just wasn't enough to overcome weather and the broader risk-off trade. Exporters reported another soybean sale of 252,000 metric tons to unknown destinations, while actually Sinnel Grain plans to do another soybean auction in China next week. So both are supportive for U.S. demand outlooks. And domestically, ADM announced plans yesterday to expand crush capacity for four U.S. facilities. So overall, demand continues to improve, but for now, weather remains the story the market cares about. September soybeans closed at 11.70 and three quarters, one and a half cents lower, down 69.5 cents on the week. November closed one and a quarter cents lower at 1187.5, losing 66 cents this week. And wheat traded sharply lower despite another round of bullish Black Sea headlines. Russia's grain export group warned that continued attacks on vessels and ports could significantly disrupt wheat shipments, while Ukrainian drone strikes reportedly cause some major damage at an export terminal. Yet global buyers are still not aggressively chasing supplies elsewhere. So that lack of urgency is what's weighing on the market. Importers have enough nearby coverage to wait. But late summer is historically an important period for securing fall and early winter needs, just with harvest happening in the northern hemisphere. So if Black Sea disruptions continue into August, September, buyers may eventually be forced toward alternative suppliers. But for now, wheat is trading the absence of demand, not the potential sides of the disruption. So September Chicago wheat ended 24.25 cents lower at 639.25, losing 36.38 and three quarter cents for the week. September KC closed at 707.5, down 23.25 cents on the day, and down 37 and 3 quarter cents for the week. September Minneapolis settled at 689.3 quarters down 21 and 3 quarter cents today and down 27.25 cents for the week. The cattle complex continued to fight off the border news. The deferred feeder cattle contracts, however, did leave a weekly gap above the market this week because of that. So we believe most of those gaps will eventually get filled, but much was going to depend on the number of cattle that actually crossed the border. There have been some cash bids around 233, but we haven't seen any takers as of this afternoon. So that is steadied to slightly higher than last week. And today's action in live cattle was somewhat disappointing for the bulls. Uh prices closed near the session lows after being as much as $1.50 higher earlier in the session. So we don't want to sound bearish because of the supply side of the market really hasn't changed, but open interest continues to decline, which is generally not a positive sign for a bull market. August live cattle gained 52.5 cents to close at 231.75, while December added 22.5 cents to finish at 226.95. August feeder cattle were up $1.55, closing at $348.025. And October feeders gained $1.325 to settle at $335.35. Lower feed costs may have also provided some support to today's trade. It's difficult to determine, though, from today's price action whether we're seeing the funds still unwinding their short cattle, long hog spreads. Both markets really finished higher with um with uh lean hogs outperforming live cattle. Perhaps the spread onwinding was largely run its course, which could benefit the lean hog market here moving into next week. Lean hogs recovered um some of this week's losses today, but after yesterday's wide trading ranges, today's session produced only an inside day of trading. So that doesn't give the bulls much momentum, but it does suggest a sharp two-day decline has at least paused. So going into the next week, traders will be watching how the poor cutout performs and whether daily slaughter levels begin to increase. Seasonally, though, we've been talking about this all week. Lean hog prices do tend to go lower here during August, but some of the industry believes supplies will not increase by their normal seasonal percentage this year. Obviously, time will tell if that proves to be the case. August hogs closed 42 and a half cents up, uh, closing at 98.85. October added $1.50, finishing at $84.85. So, again, if you have any questions, feel free to reach out. Otherwise, have a great weekend. We'll talk to you again next week.