CNR Canadian National Railway Company

By Kirk Maltais

--Corn for December delivery fell 1% to $3.52 1/2 a bushel on the Chicago Board of Trade Tuesday, with grains traders less optimistic that hot weather would put a dent on abundant crop supplies.

--Soybeans for November delivery fell 0.4% to $9.02 1/2 a bushel.

--Wheat for September delivery rose 0.4% to $4.95 1/4 a bushel.

HIGHLIGHTS

Rain or Shine?: Uncertainty about what the weather will look like in the U.S. Corn Belt this week - which had grain futures up yesterday - pulled them down today. "Some forecasters are calling for significant stress for crops over the next 10 days, while others believe that timely showers will continue to help the crops get by until the pattern turns - hopefully by late this month," said Arlan Suderman of StoneX. "It all comes down to how you interpret various changes occurring in both Pacific sea surface temperatures and atmospheric drivers, and which factors will dominate in shaping Midwest conditions."

Napoleon Complex: Unlike corn or soybean futures, CBOT wheat futures rose in response to indications that the French wheat crop will be smaller than previously anticipated. France's agricultural ministry estimates its 2020 soft wheat harvest at 31.3 million metric tons, down 8 million tons or 21% from last year. It'd be the smallest French crop since 2003, according to the ministry. The news drove wheat futures higher Tuesday, said Terry Reilly of Futures International.

INSIGHTS

Amber Waves: The USDA's monthly WASDE report is due out noon ET on Friday, and in it grains traders are expecting to see updated production, stockpile, and yield data for corn and soybeans. Overall, this updated data is expected to show that U.S. crop supplies will stay abundant this year - even with hot weather this summer drying out soils while crops attempt to grow. "Don't look for anything bullish in the numbers Friday with trend yields likely to project large corn supplies and adequate bean supplies," said Doug Bergman of RCM Alternatives.

Lackluster: Despite a strong showing for grain export inspections on Monday, grains traders are still concerned that a lack of notices from the USDA about sales of grains over 100,000 metric tons to China means little in the way of new sales are actually happening. "What has been absent so far this summer is sales to nations other than China," said AgResource. "Covid-19 appears to have a negative impact on world grain trade." Without strong demand from the export market, U.S. farmers may have a tougher time selling their crop - as domestic demand has stayed weak in the U.S., especially with a resurgence of coronavirus in some states. "The U.S. market lacks a demand driver to push grain/soy upwards, " the firm said.

Record Haul: Canadian National Railway said that it moved a record amount of Canadian grains in the first half of 2020 - transporting 15 million metric tons of grain for the year through June 30. The company says that it's on pace to transport 26.9 million tons by the end of the year, which would break last years' record of 26.5 million tons. "From Canadian farmers to port terminals, these achievements are a testament to the strength of our supply chain and its ability to meet the continued strong global demand for grain," said James Cairns, the company's senior vice president of Rail Centric Supply Chain. CN's record performance comes despite the coronavirus pandemic impacting demand for grains globally.

AHEAD:

--The EIA releases its weekly update on ethanol production and inventories at 10:30 a.m. ET Wednesday.

--The USDA will release its latest weekly export sales numbers at 8:30 a.m. ET Thursday.

--The USDA will release its monthly WASDE report at noon ET Friday.

--The CFTC releases its weekly commitment of traders report at 3:30 p.m. ET Friday.

(END) Dow Jones Newswires

July 07, 2020 15:24 ET (19:24 GMT)

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