Daily Market Cast: 8/19

Daily Commentary: Wednesday, August 19, 2026 

Transcript

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Good afternoon everyone. Today is Wednesday, August 19th, and this is Sam with today's commentary. Gray markets pushed higher today as pro farmer crop tour results continue to challenge USDA's big crop outlook. Nebraska corn was estimated at 163.61 bushels per acre, nearly 10 bushels below the three-year average. Indiana came in at 183.54 bushels per acre, also below both last year and its three-year average. Soybean pod counts disappointed in both states as well. What scouts found in the fields is just as important as the numbers. Nebraska crops showed the effects of a hot, dry summer, particularly in non-irrigated areas. Indiana had the opposite problem with excessive August rainfall leaving fields saturated and increasing concerns about road damage, disease, and additional yield loss. Illinois and western Iowa are next. If those results also fall below recent averages, the rally will have a stronger fundamental foundation. Better findings could suggest the weakness is more regional and return attention to USDA's forecast for a very large national crop. Outside markets are adding support, treasury yields and the US dollar are moving lower, which improves the competitiveness of U.S. green exports. Middle East tensions also remain elevated after the UAE cut economic ties with Iran, adding more uncertainty around energy supplies and shipping through the Strait of Hormuz. Diesel prices are also approaching all-time highs. Latest EIA reports show crude inventories building, but distillate supplies fell even with refineries operating near capacity. That means fuel pressure is showing up downstream, increasing freight, harvest, and production costs. Coolant and dryer conditions should help saturated areas of the eastern corn belt stabilize. However, improved weather cannot reverse damage that has already occurred. For now, the market is adding back risk premium and asking whether the crop is truly large enough to meet the expectations already built into prices. Corn futures continues to hold a firmer technical structure, especially after we closed above 492 in today's session, which could open the door to another leg higher. A breakout would put the summer high near 506.5 back in play. Momentum remains positive, although short-term indicators are becoming overbought. Initial support comes in around 485 to 483 with stronger support near 480. Demand remains another positive underneath the market. Brazil's growing ethanol industry is increasing domestic corn use, while August exports are expected to fall well below last year's pace. U.S. corn remains competitively priced against Brazil, although Argentina is still cheaper. Weekly ethanol production was below expectations and below the pace needed to meet USD's corn for ethanol estimate. The market has struggled to generate much selling pressure on setbacks, keeping the path of this least resistance higher for now. September corn futures gained 9.3 quarter cents at 473. December futures closed 10 cents higher at 498. Soybeans continue to show improving technical strength with November futures now pressing resistance near 1239. A move through that area would keep the short-term trend pointed higher while 1205 becomes the first meaningful support on a setback. Open interest increased by more than 15,400 contracts yesterday, suggesting participation continues to build into the move. Brazil remains an important competitor. Sinograin also auctioned 360,000 metric tons overnight and sold roughly 308,000 metric tons. Soybean oil is also finding additional support from expectations for record Indian imports as Black Sea sunflower oil shipments remain delayed. September soybean futures settled at 1222 and a quarter up 21.5 cents. November futures finished at 1237 and a quarter up 20.5 cents. Wheat remains caught between Black Sea uncertainty and Russia's aggressive export pricing. Export values are still deeply discounted versus U.S. offers, making it difficult for American wheat to capture stronger demand even with continued logistical disruptions. Spring wheat has been the relative standout as of late. September Minneapolis finished higher Tuesday while Chicago and Kansas City sold off and continued to lead most of the day Wednesday, trading near 696. Momentum remains constructive with the market holding above its short-term moving averages. Support comes in near 671 to 666. Kansas City still has a major technical hurdle near the 777 contract high. A clean break above that level would be constructive, but another failure could it invite renewed selling given Russia's price advantage. Chicago also needs to regain the 680 area to extend its rally. For now, Minneapolis has the strongest technical structure of the three week markets. September Chicago futures gained 15.3 quarter cents at 680 and a quarter. Kansas City futures closed at 762, higher by 18 and a quarter cents. And September Minneapolis futures settled at 694, up 17 and 3 quarter cents. The cattle complex is now in a three-day trend. That trend has been for prices to open higher to sharply higher for about two hours, only to see selling begin and continue through most of the day, taking away the majority of the early gains. Today, however, some contracts traded high enough to post prices above yesterday's high, but by the closing bell they had fallen below yesterday's low. This creates an outside reversal day down, which is a bearish technical signal on the charts. The cattle market has had its share of bearish news thrown at it over the past month and will now have to work through Friday's cattle on feed report. The trade is looking for approximately 2% more cattle on feed than a year ago, mainly because marketings are projected to be only 92.6% of last year's level. Cattle are backing up in the feedlots, and that is not a good situation for the market. Last November, the December 25 cattle contract printed a low of 204.55, while this year's December 26th contract printed a low of 197.05 at the same time frame. The fundamentals of tight cattle supplies don't warrant a move to those levels, but the sentiment in the market can justify such a move or even lower. If you don't have protection in place, we encourage you to get some on. December cattle were down 205 today, closing at 217.15. The feeder cattle saw sharp losses today and closed at its lowest level in nine months. Friday's lows are still holding but barely. It appears that new lows are forthcoming as the mood has changed in this market. August feeders closed 237.5, lower, closing at 336.85. And October was off $4.27.5 cents, closing at $3.22.5 cents. Lean hogs had a positive day, closing with small gains. We believe hogs are simply pausing before the next log lower begins. The easing of Canadian tariffs will allow pork exports into Canada to move duty-free, and this may have provided some strength to the market today. Canada accounts for about 8% of total U.S. pork exports during the first out four months of 2026. U.S. pork exports to Canada were running about 12% above year-ego levels. And with the tariffs now eased, exports could return to the levels seen before the tariffs were implemented. This was some bullish news for the hog market today. October hogs gained 77.5 cents to close at 81.50, while February hogs were up 25 cents to finish at 74 and 25 cents. This concludes today's commentary. We hope everyone has a great evening, and we will talk to you tomorrow.