Rice
Rice was notably excluded from the recently announced Market Facilitation Program. However, USA Rice estimates that the impact to the U.S. rice industry from all retaliating markets and Mexico (which has opened an annual zero-duty tariff rate quota for all origins, reducing the NAFTA-based preference) to be $210 million annually, out of a three-year average export value of $1.83 billion. U.S. market share for all rice imports had fallen to 68 percent in May, the lowest level since NAFTA began.

USDA says 40 percent of Arkansas’ crop is now heading. Despite the late start due to cold weather in April, hot weather in May helped the crop catch up and is now tracking ahead of the five-year average of 32 percent being headed. Sixty-five percent of Arkansas’ crop is rated good to excellent. November futures are currently consolidating between resistance in the $12 area and support near $11.50.

Cotton
Cotton futures have recovered some from the selloff charted in late June. The December contract has been unable to challenge resistance at 89.52 cents, however, and futures are beginning to trend mostly sideways as a result. USDA says 39 percent of the crop is rated good to excellent, with 33 percent rated poor to very poor. The expanding drought in Texas has traders wondering about yield and potential abandonment. USDA currently has production pegged at 18.5 million bales, down from 20.9 million last year.

Soybeans
Soybean futures fell to their lowest levels since December 2008, but are now attempting to build on support at the contract low, which is $8.26 ¼ for November. The sharp downtrend did, however, drum up demand for U.S. beans, as export sales improved last week and even Argentina, the world’s third-largest soybean producer, bought U.S. origin beans. U.S. prices are now 20 percent cheaper than Brazilian supplies. Record-setting domestic crush numbers also have provided some support in recent days. USDA says 70 percent of the crop is in good to excellent condition, with another 22 percent in fair condition and only 8 percent in poor to very poor condition. Expect the upside to continue to be limited for the time being by expectations for good yields and trade concerns.

Corn
Corn futures are finally showing signs of bottoming, with December finding support at the contract low of $3.50 ¼. The turn-around is mostly attributed to declining crop conditions and demand created by crop losses in Argentina and Brazil. The crop in Europe and the Black Sea region are also at risk due to adverse weather conditions. USDA now says 72 percent of the domestic crop is in good to excellent condition, which is the third highest since 1986. With a hot, dry August in the forecast, though, traders are now expecting that number to decline into harvest. Low prices have increased demand for both ethanol and livestock feed.

Wheat
Wheat futures have rallied in recent days. Reduced production estimates coming out of Europe have been supportive. The Wheat Quality Council’s annual tour kicked off this week, and so far are measuring yields well under the five-year average and USDA projections for this year in North and South Dakota. The trade will continue to watch the tour closely. Egypt has been a major customer this week, despite the recent rally.

Livestock
The July 1 USDA Cattle on Feed Report set a record. A total of 11.3 million head on feed on July 1, 2018, was the highest for that date since the report began in 1996. Placements during June totaled 1.79 million head and were up 1 percent from a year ago. Strong domestic demand is supportive, as futures continue to trend higher. U.S. beef export shipments are also climbing, despite concerns that tariffs will limit demand.

U.S. hog futures, on the other hand, continue to track lower, with prices plummeting $11 in July. Rising slaughter rates are expected to keep pressure on cash and futures prices. Mexico continues to be a top destination for pork exports.