HIGHLIGHTS

• MARKET TREND—Steady/Higher: CU, $.03; SU, unch; WU, +$.09; KWU, +$.1075.
• MACRO: Merkle stays in office as Germany reached a surprise immigration compromise.  Asia—Mostly lower:  Nikkei, -0.12%; Shanghai, +0.39%; Hang Seng, -1.41%.  EUROPE: Turn-around Tuesday:  DAX, +1.20%; FTSE, +0.50%; CAC, +0.97%. WALL STREET: U.S. pre-markets are higher as well: DOW, +130; S&P, +11.25; NAS,+31.00.  EXTERNALS: Sep crude: +$0.75 @ $72.37; Aug Gold: +$6.30 @ $1,248; Dec $ Index, -.404 @ 93.930. Dely: BO, 1,275; RR, 23; C, 369; HRW, 152; O, 37; SB, 692, SRW,0

·       T-storm Weather: The next round of heat unfolds into Thu.-Fri. as maximums reach the 90s and minimums hold in the 70s, then ends as a cool front passes and produces seasonable coolness for two days within Thu.-Sun.  Some thunderstorms precede and accompany the front, especially in northwestern areas.  Another period of heat likely begins Sat.-Sun. in the Plains and Sun.-Mon. in the Corn Belt, as the upper-level high expands, lasting for three to five days in most areas

·       CU, +$.03 @ $3.50; CZ, +$.03 @ $3.62.  Heavy fund selling, estimated at 30 K                     

• SQ, unch @ $8.5350; SU, unch @ $8.5925.  Funds: Sold 10 SB, 5 SBM; 5 SBO.  Board Crush: $1.86, $.00; LY: $.98
• WN, up $.09 @ $4.8925; WZ, up $.0925 @ $5.06.  The week began with the funds selling 15 K                            

 CORN/SORGHUM

·       U.S. corn crop is rated 76% Good/Excellent versus 77% last week and 68% last year.  Warmer-than-normal temps continue to accelerate crop development: silking is pegged at 17% compared to 9% last year and the 5-year avg. of 8%

·       ATI Research: Updated yield estimate for the 2018 U.S. corn crop is 178.4 bpa versus June USDA projection of 174.0

• T-storm Weather: Another cool front potentially returns temps to seasonable levels for a few days around July 12.  A few thunderstorms occur in varying areas July 9-16, producing generalized totals of 0.50”-1.00” across a wide area

·       Consultant: Brazil corn crop estimated is unchanged at 81.0 MMT with a neutral to slightly lower bias

SOYBEANS/WHEAT

·       U.S. soybean crop rated 71% Good/Excellent v. 73% last week & 64% last year.  Blooming at 27% v. 5-year avg. of 13%

·       ATI Research: Updated yield estimate for the 2018 U.S. soybean crop is 49.7 bpa versus June USDA projection of 48.5

·       Consultant: Argentina soybean crop estimate is unchanged at 36.0 MMT with a neutral to slightly lower bias

• ATI Research: U.S. winter wheat crop estimate is down 13 mbu to 1.153 bbu.  Harvest is pegged at 51% compared to the 49% avg.  HRS crop estimate is up 23 mbu to 582 due to the increase in acreage in last week’s USDA report
• T-storm Weather: Despite some rain last week, agricultural drought is widespread across Australia wheat.  There is historical precedent for below-trend yields when La Niña diminishes in a similar manner to that expected for this year

ENERGY

·       Firm: CLU18, +$.75 @ $72.37; EBU, +$0.67 @ $77.97; EBU-QCLU, -$0.07; RBU, +.0129; NGU, -.005; HOU, +.0159

·       On Monday, cash ethanol markets were weaker: Chicago was quoted at $1.395, down $0.03; Basis to Chicago—New York, +$0.1525; Gulf, +$0.09; Dallas, +$0.115; Tampa, +$0.25; and LA, +$0.32 

·       Ethanol RINs were lower on Monday: 2017’s eased ½ to 14 ½-15 ½; and 2018’s fell 1 ¾ to 21-22 ½

·       The August RBOB/July ethanol spread lost $.0523 on Monday, retreating to +$.7018/gallon

  LIVESTOCK/POULTRY                      ​;               

• Choice boxed beef values were 8-cents lower on Monday at $211.88 and are down $5.81 vs. a week ago
• 5-Area Weekly Weighted Average Steer price fell $1.87 v. last week to $106.87/cwt and is $11.77 lower v. last year
• USDA mandatory pork carcass cutout value fell 88-cents on Monday to $85.75 and is 8-cents lower vs. last week
• Current nearby board hog crush value is $45.80/cwt vs. last week’s $44.13, last month’s $43.19 & last year’s $53.030

Sources: Bloomberg, Dow Jones, AP, DTN, T-storm Weather