-End July Canadian wheat stocks sharply lower than expected, but historically large crop this year provides offset
-Weather models back off cold temp threat
-USDA reports more soybean sales to China
-Markets closed Monday for Labor Day
The previously-forecast cold temp threat to parts of the upper western corn belt was largely removed from today’s model runs. While notably below average temps are expected, frost-inducing temps are no longer advertised (see details below). It’s a light news morning heading into the extended weekend. Grain markets will be closed after today’s day session close until the Monday overnight session for the Labor Day holiday. All of next week’s regular USDA/EIA reports will be pushed back one day due to the holiday, with Export Inspections and Crop Progress on Tuesday, EIA ethanol data on Thursday and Export Sales on Friday. Crop conditions are expected to decline another 2-3% in Tuesday’s update. The USDA’s Crop Production and WASDE reports will be out on Friday next week. Our pre-report commentary/analysis will be posted on Market Insights later
today.
 In the equivalent of the USDA’s quarterly Grain Stocks report, Stats Canada reported end July Canadian wheat stocks were 5.028 MMT, sharply below the average trade estimate of 5.7 MMT (5.0-6.6 MMT range of ideas) and were down from 5.891 MMT last year and 6.732 MMT in 2018. July 31 canola stocks were reported at 2.741 MMT, above the average trade estimate of 2.3 MMT (1.9-2.8 MMT range), but down notably from last year’s 4.175 MMT (2.506 MMT 2018). July 31 oat stocks were reported at 426k tonnes vs average expectations of 600k (400-800k range) and compares to 397k tonnes last year (778k 2018). The lower than expected wheat stocks, though, are fundamentally offset by expectations for a historically large wheat crop this year, last estimated by Stats Canada at 35.74 MMT vs last year’s 32.35 MMT crop and will be the 2nd largest on record behind 2013/14’s 37.6 MMT.
ï‚· USDA reported 318k tonnes of soybeans sold to China and 175k tonnes of soybean meal to the Philippines for 2020/21 delivery this morning.
ï‚· The average trade estimate of end August Malaysian palm oil stocks is 1.790 MMT (1.650-1.876 MMT range of ideas), which would be up slightly from 1.698 MMT in August and reflect the first increase in four months. Year ago August palm oil stocks were 2.252 MMT. August palm oil production is expected to tick higher to 1.844 MMT (1.700-1.923 MMT range) from 1.808 MMT in July and would compare to 1.822 MMT last year. The rise in expected stocks in August is attributed to the estimated decline in exports to 1.533 MMT (1.489-1.780 MMT) from 1.782 MMT in July and compares to 1.733 MMT last year August. The Malaysian Palm Oil Board will release their monthly report on September 10.
 Brazilian ag consultant Celeres bumped their estimate of next year’s Brazilian soybean crop up to 131.4 MMT from 130.8 MMT previously and compares to USDA’s latest ideas of 131.0 MMT and this year’s crop of 126.0 MMT. Celeres sees Brazil’s 1st corn crop in the coming year at 30.0 MMT, unchanged from previous ideas, which would be up solidly from this year’s 25.7 MMT.
 Bulgaria sees this year’s wheat crop at 4.6 MMT, down sharply from 6.1 MMT last year due to the region’s drought this year.
ï‚· ADM put out 220 contracts of corn deliveries this morning.
Weather
Rains of .20-.70†fell across the OH River Valley yesterday, with the rest of the belt dry. Rains are expected Sunday of .50-1â€+ for the southern 1/3 of MN, the northeast 1/3 of IA, into S WI, extreme northern IL and most of MI, while the rest of the belt misses out on this activity. Both models then agree a strong cold front will begin dropping into the region Monday and will generate rains in the NW Midwest starting Monday and continuing possibly through Thursday. Each model has its own idea with the details with the GFS indicating 1-2â€+ to fall across the eastern 2/3 of IA, into southern WI, the northern ½ to 2/3 of IL, NW 1/3 of IN and much of lower MI, with totals of .50-1â€+ in the rest of the belt. The European sees rains of .50-1â€+ to fall in areas west of a line from Kansas City to Chicago to the MI thumb, with totals less than .35†elsewhere. A blend of ideas is likely the best call which would result in the corridor of heaviest rains falling in the eastern 2/3 of IA, the SE 1/3 of MN, most of WI, the northern ½ of IL and NW corner of IN with totals in the .65-1.25†range with a few isolated heavier totals. Totals across the rest of the region would be in the .25-.75†range. Temps will run average to below in most of the region for the rest of this week and weekend and then look to fall to below average in all of the region next week. The European has backed off on any cold air threat for the NW Midwest, but the GFS continues to see temps of 34-36 across all of MN. The GFS has backed off any cold air threats for IA, with temps there to bottom out around 44. Thus the cold air threat for IA is basically gone as things stand now and is lessened for MN.