HIGHLIGHTS
· MARKET TREND—Firmer: CU: +$.0625; SQ: +$.1725; WU: +$.07; KWU: +$.0625
· MACRO: Despite opinions Brexit will lead to a slow-down in the UK and subsequently spread to the EU, markets continue to edge higher. ASIA:Shanghai, +.36%; Hang Seng, +.46%; Nikkei, +.84%. EUROPE: higher as well with the DAX up .17%; the FTSE, +.26% & CAC, +.51%. WALL STREET: Futures point to a higher start—DOW, +16; &P, +2 ¾; NAS, + 9 ¼. OUTSIDE MARKETS: The $ Index is down .142 @ 96.345; August Gold is $3.60 higher @ $1,338.90 and August crude is off $.62 to $46.18. Deliveries: SBM, 85; SBO, 100; Corn, 87; SB, 235; SRW, 25
· T-storm Weather: A strong system drifts through southern Canada this week, causing heat to affect the southwest half of the central U.S. through Thursday, followed by several days of seasonable coolness. The system causes the jet stream to stall across the northern U.S., which will then interact with a continual influx of heat and humidity feed from the south, both triggering and fueling thunderstorms through early next week. Widespread rain of 1.00”-2.50” is probable; highest coverage in the Corn Belt
· Corn: CU Up $.0625 @ $3.5850; CZ Up $.0625 @ $3.6650. Funds wee back buying, 7 K on Tuesday
· SB: SQ Up $.1725 @ $11.1975; SX Up $.1725 @ $11.0425. Funds: bot 12 K SB, 7 SBM; 5 K SBO. Aug crush, -$.06, $.70; LY: $1.07
· Wheat: WU Up $.07 @ $4.4550; WZ Up $.0625 @ $4.6725. The funds bought 6 K yesterday
CORN/SORGHUM       ;
· ; ATI Research: USDA WASDE report increases U.S. old-crop corn exports by 75 mbu and new-crop by 100 mbu; bias here is the USDA is under-estimating just how brisk the old crop and early new crop export program could be
· USDA WASDE reduces 15/16 Brazil corn crop 7.0 MMT. Crop consultant notes additional reductions are possible
· Ethanol margins: $0.39 per gallon—down from 0.45 last week but above $0.28 last year. EIA report at 9:30 AM CDT
· T-storm Weather: Widespread coverage of hot/very hot weather initiates in U.S. within July 17-19; maximums in the 90s-100s, minimums in 70s-80s. Rain erupts along the ridge of heat next week, most likely in northern/eastern areas
SOYBEANS/WHEAT
· ATI Research: USDA WASDE report increases U.S. old-crop soybean exports by 35 mbu and new-crop by 20 mbu; bias here is the USDA is under-estimating just how brisk the old crop and early new crop export program could be
· USDA WASDE report reduces 15/16 Brazil soybean crop by 0.5 MMT to 96.5 with exports down 1.55MMT to 57.2
· USDA Crop Production report: Hard red winter wheat crop up 96 mbu v. June; record yields est. for Kansas, Oklahoma
· ATI Research: USDA WASDE report increases U.S. all wheat feeding by 100 mbu to 300 due to ample supply of hard red winter & price competitiveness with corn; additional increases possible if U.S. corn yield falls short of projections
ENERGY
· Lower: CLQ16, -$0.62, $46.18; EBU, -$0.77; EBU-CLU, $0.86, -$.04; RBQ, -.0274; NGQ, +0.051; HOQ, -$.0288
· EIA estimates: crude, -2.6 (API: +2.2); Gasoline, -0.9 (+1.5); Distillates, unchanged (+2.6)
· Cash ethanol markets were slightly lower on Tuesday: Chicago and Tampa off ½; New York eased ¾; Gulf down ¼; Dallas slid 1 ½; and LA was 1 ¼ lower at $1.75 ¼ per gallon
· Ethanol RINs unchanged: 2014’s at 96 ¼-98 ¼; 2015’s at 96 ¼-98 ¼; and 2016’s at 96-98
· The Aug RBOB/Aug ethanol inverse lsost $.0346 on Tuesday, slipping to -$.16090/gal ;
LIVESTOCK/POULTRY    
· Choice boxed beef values plummeted $2.32 on Tuesday to $206.38, down $2.45 vs. a week ago & lowest since May 6
· ATI Research: WASDE raises 2016 U.S. beef production est. by 270 mil lbs vs. June; annual total est. up 5.3% vs. 2015
· USDA mandatory pork carcass cutout value gained 50-cents on Tuesday to $89.46 and is up 61-cents vs. last week
· CME Lean Hog Index declined $0.30 on Tue. to $81.97. July futures firmed $0.325 but are still $2.02 below the index
Sources: Bloomberg, Dow Jones, AP, T-storm Weather