Daily Market Cast: 8/18

Daily Commentary: Tuesday, August 18, 2026 

Transcript

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Hey everyone, this is Allison giving you today's deadly green market commentary for Tuesday, August 18th. And we saw some early strength across the board starting in the overnight, but as the session wore on, it definitely faded. And that suggests to us that the move may have been driven more by technical buying than a meaningful change in fundamentals. The crop doer is obviously providing plenty of disappointing yield reports and dramatic pictures, but headlines alone will not sustain the rally. Money flow matters, and the funds will need to keep buying if prices are going to build on the recent move. Yesterday's crop progress report showed corn conditions slipping one point to 60%, while soybeans fell one point as well to 61% good to excellent. Both do remain well below last year. Iowa continues to post some of the most strongest ratings, while conditions are considerably weaker in the Dakotas and Kansas. But development overall across the crops remains well ahead of normal. 76% of the corn is at dose stage, 29% dented, and 85% of soybeans are setting pots. But must most of that advancement is actually concentrated in the northern and western corn belt. And while that faster development certainly reduces some frost risk, it does not guarantee a strong finish. Heat and dryness can push these stressed plants toward maturity before kernels and seeds reach their full weight. Winter weed harvest is virtually complete, king in at 96% complete, while spring weed harvest advanced to 41%, seven points ahead of average. And with combines running, actual yield and quality reports are going to be mattering more now than condition ratings. So a quieter, dryer forecast should allow harvest to continue, hopefully reaching that 50% mark next week. That'll start easing some of this harvest pressure we're seeing in the market. But the quieter pattern should also benefit some of the Midwest. Saturated eastern fields need sunshine and time to drain, while western areas still need enough moisture to finish. So the same dryer forecast that helps the east could increase stress in the west, where crops are obviously at a greater risk of shutting down too early. So there'll be no shortage of poor field checks, eye-catching pictures this week. The market's response, though, is going to tell us whether those reports are changing production expectations or simply creating another short-lived round of buying. But the first pro farmer tour results are worth noting here in corn. South Dakota's yield was down 14.4% from last year, while the USD expects an 11.7% decline. And Ohio actually shored a much bigger gap. The tour found a 3% decline while the USD is actually projecting a 5.4% increase. We know one or two states won't decide the national crop, but if we find similar results here during the week in Iowa or Illinois, it definitely would be much harder for the market to ignore. And money flow is also adding support here to the recent rally. Speculative traders bought more than 20,000 contracts yesterday, potentially increasing their net long position to 244,000 contracts, which would be their largest in three months. Open interest rose by more than 15,000 contracts as well, suggesting that new money entered the market. So the crop tour supplied the store, the funds now supplied the fuel. But September and December corn did reach three-month highs overnight and tested those July highs. So that creates a possible double top. Um, corn now needs to prove itself going into the end of the week. We need to see a close above those July highs to really be constructive on the charts. A failure to hold could trigger some profit taking from obviously a large group of speculative longs. But September corn futures did finish one and three quarter cents lower at 463 and a quarter. December closed at 488, one and a half cents lower. And for soybeans, demand is helping. U.S. golf offers are 30 to 35 cents below Brazil through the end of 2026. And the USD is announced did the USD did announce another sale of 136,000 micro tons to China this morning. So the US has the price advantage, and now sales need to continue. And the tour results are also worth watching here. South Dakota pod counts were down 20.4% from last year, while the USDA expects a 12.8% yield decline. Ohio showed a bigger gap. Podcounts were down 7%, while the USDA is projecting a 9.4% yield increase. And Nebraska pod counts were down nearly 6%. So pods are not bushels. We understand that, but similar results in Iowa and Illinois could be very hard for the market to ignore. September and November soybeans traded to new highs for the month. The next major test is going to be the contract highs. Continued demand, fund buying are going to be needed to reach those. September soybeans ended less than a penny lower at $12.3 quarters of a cent. November settled at $12.16 and three quarters less than a penny higher. And despite ongoing Black Sea logistical issues, Russia still has wheat to move and remains aggressive on price. So just for comparison, U.S. Gulf soft red wheat is priced near $281 per metric ton, while hard red winter wheat ranges from roughly $325 to $332. Freight and quality matter, but a discount of more than $100 to the U.S. hard red wheat explains why stronger export demand has been difficult for the U.S. wheat market to sustain. September Kansas City wheat traded within a dime of its $777.5 contract high overnight. A break above that level would be constructive. Failure to get through it could bring in another round of short selling, like we saw in today's session, especially with Russian wheat still priced well below the U.S. September Chicago wheat ended 10.25 cents lower at 664.5. September KC closed at 743 and three quarters, 15 cents lower. And September Minneapolis finished at 676 and a quarter, one and a quarter cents higher. All but the October Lean Hog contract printed new lifetime contract lows during the session. October's contract low is 77.95 and today's low was $80. So if nothing changes in a big hurry, we see no reason why October hogs won't eventually make a new contract low. October Hogs were down a dollar today, posting their lowest close since June 16th. There is simply just too much pork available on the market with slaughter weights higher, pork imports running 6% above last year, demand just can't absorb the additional supply. And the supply of pork needs to get smaller or demand needs to improve substantially. And we don't see either of those things happening, at least in the near term. The cattle complex had a repeat of yesterday's action. Contracts opened higher with triple digit gains, only to see selling come into the market and prices trading steady to lower a few hours later. By closing bell, however, all contracts finished higher. August live cattle gained 35 cents to close at 224.90. December was up 80 cents at 219.20. August feeder cattle were the only contract lower today, falling 75 cents to close at 339.22.5, while October feeders gained 97.5 cents, finishing at 326.32.5. The market is still searching for price discovery after a wall of bearish news that has been thrown at the cattle complex here just over the past 30 days. So there was some cash trade in Iowa yesterday at 223 to 226, which would be six to nine dollars lower than a week ago. So these prices are putting feed lots in the red, and hopefully they had some protection in place. The Catalan fee report is due Friday and should be neutral to friendly for the market. Marketing should have a more bearish tone, however. Friday's report should shed some light on that and give the market another piece of information to work with as it continues here in this search of price discovery. We'll probably find out more on that on Monday. But anyway, if you have any questions, feel free to reach out. Otherwise, have a great night. We'll talk to you again tomorrow.