Daily Market Cast: 8/4

Daily Commentary: Tuesday, August 4, 2026 

Transcript

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Good afternoon, everyone. Today is Tuesday, August 4th, and this is Sam with today's commentary. Turnaround Tuesday, despite some supportive fundamental news, the USDA reported another 132,000 metric tons of soybeans sold to China for 26-27 delivery, while corn conditions ratings fell another two points. What a temperature swing after near record heat across the plains and northern corn belt. Temperatures fell into the upper 30s and 40s this morning. Rawstown, Saskatchewan, briefly reached 33 degrees, although no meaningful frost damage was suspected. The cooler temperatures provide a near-term relief by slowing crop development and reducing moisture demand. Warmer weather returns later this week and above normal temperatures remain favored next week. But the immediate forecast is non-threatening enough to give green traders a reason to step back. The broader risk-off tone also added pressure. Expectations that the Middle East conflict could be nearing sun pep resolution pushed crude oil more than $4 lower today as traders removed additional geopolitical risk premium. That narrative has changed repeatedly, but today the prospect of de-escalation carried more influence across the commodity complex. Corn conditions ratings fell another two points to 61% good to excellent, extending the two-week decline to six points. Poor to very poor ratings increased 14%, double last year's levels, while the good to excellent rating is now 12 points below a year ago. The deterioration remains concentrated across the plains and northern cornbelt. North Dakota plunged 13 points to just 37% good to excellent. Kansas dropped eight points to 46%, and Nebraska fell six points to 54%. Minnesota, Missouri, and Wisconsin each declined two points. Meanwhile, Iowa held on an impressive 80%, while Illinois improved 1.60%, and Indiana gained one point to 64%. That split makes the yield impact difficult to quantify. Strong conditions in Iowa and stability across the central and eastern corn belt could offset some losses farther west and north. However, continued deterioration across several major producing states makes USDA's current 183 bushel an acre yield increasingly difficult to accept without exceptional results from the better areas. The crop is not collapsing, but it is becoming increasingly uneven as August grain fill begins. September corn features closed seven cents lower at 442.25. December features finished at 465.5%, down seven cents as well. Soybean conditions held steady at 63% good to excellent last week, but remained six points below a year ago. The breakdown by state was mixed. Kansas fell five points to 59%, Nebraska dropped four points to 57%, Minnesota declined three points to 75%, and North Dakota slipped two points to just 44%. Meanwhile, Iowa held strong at 78%, Illinois and Indiana each improved one point, and Ohio, Missouri, and South Dakota gained two points. The national rating avoided another decline, but soybean yield potential remains a concern. Pod setting reached 62%, seven points ahead of average, meaning a large portion of the crop is entering its most important reproductive stage. Unlike corn, soybeans still have time to add or lose yield through pod retention and seed size. Recent rains across Iowa and Illinois should help, but continued dryness across the plains and northern growing regions remains a concern. The crop is not in poor condition nationally, but with ratings below last year and August weather carrying the greatest influence on final yield, USDA's current 53 bushels per acre forecast is far from secure. September soybeans futures gave back 15 cents, closing at 1158 and three quarter, and November futures finished the day at 1177 and three quarter down 14.5 cents. Spring week conditions improved two points last week to 55% good to excellent compared with 48% last year. However, the state level movement was sharply divided. South Dakota improved 16 points to 43%, and Montana gained 12 points to 55%. Meanwhile, North Dakota fell six points to 46%, Idaho declined five points to 54%, and Washington dropped eight points to 59%. Minnesota remains the strongest at 90%. The improvement is encouraging, but conditioned ratings become less meaningful as harvest begins. Spring wheat harvest reached 5%, slightly behind the five-year average of 8%, although South Dakota was already 39% complete. North Dakota was just 2% harvested, meaning the market will soon begin replacing condition estimates with actual yield and quality reports. The North Dakota decline is worth watching, giving its importance to national production and the dryness across the eastern part of the state and into Minnesota. The national crop appears better than last year, but late season stress may still trim yields and test weights as the final portion of the crop finishes. September Chicago futures gave back 12.5 cents to close at 638.5. Kansas City September futures closed at 7.07, down 10.25 cents. September Minneapolis futures also give back 10.5 cents at 684.5. Onto the livestock complex, the union rejected Cargill's latest offer to settle the ongoing strike at its Fort Morgan, Colorado beef plant. As a result, the plant will remain idle for the foreseeable future. Fox beef prices were stronger today, which should provide support to cash cattle prices. The livestock markets all closed higher today in an ebb and flow type of trade. There wasn't any major news to push the markets in either direction. Lower feed costs may have given feeder cattle a little extra push higher. Deferred feeder cattle contracts continue to be under pressure from bear spreading on the expectation of additional supplies once the Mexican border reopens. We believe the deferred contracts are being discounted too heavily as we don't expect an overwhelming number of feeder cattle to cross the border during the early stages of reopening. August live cattle were up 85 cents, closing at 231.85, and December was up $1.5, closing at $2.27.27.5. August feeders were up $3.37.5, closing at $3.51.20, and October was up $3.45, closing at $3.37.15. Lean hogs traded within Thursday's range for another session. Although a lower low and lower high were posted today, all contracts still managed to close higher. Cash hog prices continue to struggle to maintain upper momentum, which is limiting the nearby August contract. We came across something today that caught our attention. Canadian pork imports into the United States are running about 10% above year-go levels. We thought that was unusual, so we dug a little deeper. Some analysts claim disease issues over the past eight months have reduced U.S. hog numbers below year-go levels. That hasn't shown up in the latest USD Hogs and Pigs report, however, which indicates the inventory is roughly unchanged from a year ago. In our opinion, those two stories simply don't add up. August hogs were up 32 and a half cents, closing at 97.85, and October was up 67.5 cents, closing at 84.35. This concludes today's commentary. We hope everyone has a great evening and we'll talk to you tomorrow.