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Special Edition – Market Trends Report – USDA Report July 1, 2024

US and the World

    It is that time of year again. The Canada Day-July 4th weekend always is a seminal moment in markets across the greater American corn belt. It is the time of year when we are able to start measuring the new crop size in the field. As it is, the crop growing in the field is doing well despite problems with too much water in much of the North Central US plains.  As of June 23rd, 69% of the American corn crop was rated good to excellent.  At the same time, the soybean crop in the United States was rated 67% good to excellent.  The USDA weighed in with their acreage and grain stocks report on June 28th.

      As USDA reports go, the end of June planted acreage report and stocks numbers is always huge.  USDA estimated the corn acreage planted number at 91.5 million acres which is above pre report estimates.  This was an increase of 1.5 million acres from their March estimate.  On top of this bearish news came the old corn crop stocks estimate which was 4.993 billion bushels, 890 million bushels more than last year and 126 million bushels more than the trade had expected.  That was enough bearish news to send the new crop corn contract to a new contract low a $4.12/bushel.

      USDA estimated soybean acreage to come in at 86.1 million acres which is down 400,000 acres from their March intentions. With wet weather currently going on in the northern plains and upper Midwest there is expected to be many more soybean acres to be planted and counted in August.  The June 1st old crop stocks numbers were pegged at 970 million bushels which is slightly higher than trade expectations and 174 million bushels higher than a year ago. The market reaction was more muted in soybeans versus corn with the spot July soybean contract finishing down one and three quarters cents on the day. US winter wheat seeding came in at a lower than expected 33.8 million acres.

             On June 28th, corn, soybeans and wheat futures were lower than the last Market Trends report.   July 2024 corn futures were at $4.07 a bushel.  The July 2024 soybean futures stood at $11.33  The July 2024 Chicago wheat futures closed at $5.73 a bushel. The Minneapolis July 2024 wheat futures closed at $6.13 a bushel with the Sept 2024 contract closing at $5.73 a bushel.

     The nearby oil futures as of June 28th closed at $81.54/barrel up vs the nearby futures recorded in the last Market Trends report of $78.45/barrel. The average price for US ethanol in the US was $2.29, above the $2.23 a US gallon recorded in the last Market Trends Report.

     The Canadian dollar noon rate on June 28th, 2024, was .7306 US, higher vs the .7272 US reported here in the last Market Trends report. The Bank of Canadas lending rate was lowered to 4.75%.


       In Ontario the weather is being a bit ugly. Wet weather has been the hallmark to characterize the late spring. Ontario is a very big province and so it varies from region to region but in southwestern Ontario and Niagara wet conditions have impacted the crop. Agricorp for example did extend planting deadlines for both corn and soybeans. This resulted from widespread delays in planting and ultimately acreage abandonment. It’s simply been a tough season for many Ontario farmers.

      This will likely have a negative effect on crop yields in Ontario in 2024. It is early to estimate that but damage from spring rains and late planting have certainly made their mark. Ontario corn yield of 200 bushels per acre seen last year is only a memory.  An early Ontario wheat crop will be harvested when the rain stops.  Hopefully, the wet weather will not impact quality.

     Ontario basis levels for grains are relatively the same than it was in the last Market Trends report. Lower grain futures prices have impacted it a bit negatively, but like always this is fluid. The Canadian dollar fluttering in the 73 cent levels continues to add a default stimulus to these Ontario cash grain prices

     Old crop corn basis levels are $0.60 to $0.90 over the September 2024 corn futures on June 28th across the province.  The new crop corn basis varied from $.85 to $1.15 over the December 2024 corn futures.  The old crop basis levels for soybeans range from $3.28 cents to $3.50 over the August 2024 futures.  New crop soybeans basis levels range from $2.78-$3.05 over the November 2024 futures.  Ontario SRW wheat prices are in the $6.72 range.   On June 28th the US replacement price for corn was $5.56/bushel.  You can access all these Ontario grain prices in the marketing section at

The Bottom Line

     I don’t think you will see grains screaming higher very soon.  At least that’s the conventional thinking based on the higher quarterly ending stocks with old crop and the bigger corn acres numbers that came from the USDA.  It all makes so much sense. However, we know when it comes to commodities and especially commodity prices not everything turns out the way you might expect.

     Traditionally, the June USDA acreage report in the July the 4th weekend is a benchmark for commodity prices, and it surely might be again this year.  Keep in mind it has to do with hot and dry weather during pollination and dry weather in August for soybeans. We still might get there as the weather will have a significant impact on prices. However, if it is benign going ahead, we’re likely to slide into the fall with the prices we have.

     Geopolitics remains a concern. The Ukraine Russia war continues but grain algorithm seems to have it dialed in. There is some concern with regard to American, Canadian and European tariffs on Chinese electric vehicles. While this is understandable from a macroeconomic perspective, do not be surprised if the Chinese retaliate with tariffs on agricultural commodities.  In many ways the lack of Chinese demand for American soybeans is understandable.  With the American election heating up, this issue might become even more real.

     Of course, Brazil is the beneficiary of all this. For instance, China has had record corn imports this year and this is come mainly from Brazil. We also know what Brazil is doing with soybeans with China. In many ways, this reality is living “rent free” in the American agricultural psyche.  It is all very understandable for anybody on the outside looking in, but for our American friends it is a dose of reality. Trade wars are not easy to win.

Commodity Specific Comments


     USDA reduced their corn planting number by 1.5 million acres versus their last report. Clearly, this is still conjecture as some of those acres might have been replanted and some may be still underwater. However, we will learn in upcoming news reports where that acreage figure sits. As it is, the acreage number in the report was bearish for anything considered new crop corn.

     Market bears were encouraged by the USDA report not necessarily because of the bigger acres but also the quarterly stocks which were much higher than expected.  The 4.993 billion bushels of corn will go a long way this year and will certainly show up in the beginning stocks of the new crop year starting in September.

    The December 2024 corn contract is currently priced at 14 cents below the March 2025 contract which is a bearish indication of new crop corn demand. Seasonally, we know that corn prices tend to peak in early June and bottom out in early October. The December 2024 futures contract is at the 23rd percentile of the past five-year price distribution range.


     We know that soybeans are the great liars, and we will certainly see in 2024 whether that will come back into fruition.  At least in the USDA report the acreage did not go up like corn did. Of course, many producers would argue that there’s lots of soybeans underwater. However, the price doesn’t lie, and it has been retreating over the last several weeks.

     US soybean export demand remains a problem. American commentators continually lament the lack of soybean sales to China. That’s much to do with Brazil being the preferred destination and geopolitics.  As it is, new crop soybean sales are at their lowest point in 10 years.

     The November 2024 soybean contract is currently priced 19.25 cents below the March 2025 contract which is considered bearish for new crop beans.   Seasonally, soybean prices tend to peak in early July and bottom out in early October. The November 2024 soybean contract is currently at the 36th percentile of the past five-year price distribution range.


     Wheat futures have slumped over the last couple weeks in fact down approximately 12 days in a row. Wheat is like that, and always hard to determine where it’s going to go. It may have been a reflection of the big rise in wheat prices in front of the problems that they were having in Russia.  Since then, the Russians have actually been increasing their estimates of Russian wheat. If the row crops get in a position to rally in the next few weeks wheat may follow, but then again it may not. Keep in mind that wheat is grown everywhere, and rallies can be very short term.

     Ontario cash wheat prices have declined over the last couple of weeks reflecting the slump in futures prices. However, there was an opportunity to price wheat about $2.00 a bushel higher a month ago than there is now. Who knows what the future holds? As it is wheat will be starting to be harvested in the deep southwest of Ontario as soon as the weather dries up. Yield should be good, but as always quality is a huge concern anytime you harvest wheat.

The Bottom Line (cont.)

     The Canadian dollar remains the great default for Ontario cash grain prices. However, what we saw in the last couple weeks has been a bit of a surprise as inflation increased to 2.9% for May.  This was a bit of a surprise as many people were expecting the Bank of Canada to decrease interest rates again, but under this scenario it is unlikely. The Bank of Canada target rate is 2% and any variation of that theme would have to be met with interest rate adjustments. In this case, it is likely to mean the status quo and interest rates until inflation goes back down. As it is, the Canadian dollar is likely to stay fluttering in the 73 cent US level.

     It is important to be looking at the futures market in an authentic sense. For instance, USDA had pegged June 1st corn stocks numbers at 4.993 billion bushels which is the largest figure since a 5.177 billion bushels reported back in June of 2020. Keep in mind when you look at futures markets July corn closed 16.5 cents lower, and September closed $0.15 lower on the day. At the same time December 2024 corn, finished at $4.20 which was just above the high range for price between 2014 and 2020. Simply put, big supply is still winning the day unless a third force comes along and changes that.

     Oftentimes that means third forces of non-commercial demand getting into the commodity markets. However, at the present time it is unlikely based on the bearish scenario unless this non-commercial demand wants to get even shorter, which may be a possibility. The other third force of course is hot and dry weather coming but we had this last year and still had 177.3 bushels per acre in US corn.

     That said, it’s not time to turn the lights out. In fact, it might be time to turn them on with regard to daily market intelligence. A $4.20 close in December corn relative to our production costs is the equivalent of $3.19 a bushel before COVID. So, you can see, how cheap we are relative to our history. Keep in mind it’s always darkest before the dawn. Commodity markets are always fluid, constantly changing. As we look ahead, the challenge for all Ontario grain farmers is to balance all of these marketing factors. There will be many marketing opportunities ahead.