Nov 8 Morning Ag Commentary

by Steve Freed,

USDA report day. Grains are mixed to lower. CZ is down 1 cent and near 3.74. WZ is down 2 cents and near 5.10. SF is down 1 cent and near 9.35. Soyoil futures ae gaining on soymeal. Crude is lower. US Dollar is higher.

For the week, Winter Wheat prices are down roughly 6 cents for Soft Red Winter, down 7 in the Hard Red Winter, and down 14 for Hard Red Spring; Corn is down 15 cents; Soybeans down 1 cent; Soymeal up $1.00, and; Soyoil up 45 points (crushing margins are up 7 cents at $0.92, oil-share is up 1% at 34%).

An agreement between the United States and China to roll back existing tariffs as part of a ‘phase one’ trade deal faces fierce internal opposition at the White House and from outside advisers, multiple sources familiar with the talks said. There were reports yesterday that China may have bought up to 15 cargoes of US soybean this week. Shipment period may have been Nov/Dec.

The U.S. 11 to 16 Day Outlook for the Plains and Midwest continues with a warming temp forecast to the region for the period with but an increase in precip.

The South American weather forecast still has rains for most of Brazil with rainfall also in Argentina except in the region of Buenos Aires.  Temps average to below in Argentina, average to above in Brazil.

For the week ended October 31st, U.S. All Wheat sales are running 9% ahead of a year ago, shipments up 26% with the USDA forecasting a 2% increase on the year. U.S. Corn sales are running 43% behind a year ago, shipments 63% behind with the USDA forecasting an 8% decline. U.S. Soybean sales are running 2% behind a year ago, shipments 14% ahead with the USDA forecasting a 2% increase on the year

U.S. Agriculture Is Still at Risk, Even If There’s a Trade Deal. Investors in the commodities sector have closely tracked developments tied to U.S. trade policy, with the possibility of a resolution between Washington and Beijing providing a boost to commodities and raising hopes for demand that get dashed whenever expectations of an agreement fade. The effects of the trade war, however, go well beyond the day-to-day dealings in commodities such as soybeans and cotton, as the ongoing conflict forces U.S. trading partners to seek new suppliers. U.S. agriculture is at a growing risk of both further losing market share in China, but also not being able to regain that share back

The U.S. Agriculture Department is preparing to roll out the second tranche of aid to compensate farmers for losses due to the U.S.-China trade war, Agriculture Secretary Sonny Perdue said

China on Friday raised its estimates for soybean imports in 2019/20 by 2.2 million tons to 86.2 million tons from last month. China imported 6.18 million tons of soybeans in October, down 24.6 percent from 8.20 million tons in September, figures from the General Administration of Customs of China showed. Imports of vegetable oils in October were 912,000 tons, up 8.6 percent from the previous month

China’s pork imports will reach record levels of as much as 4.6 million tons next year, Dutch financial services firm Rabobank said; China’s pork imports are already set to surpass previous records this year, reaching between 3.1 million and 3.3 million tons including offal, the bank said in a report, up from 2.1 million tons last year.

Wheat in the south of Argentina’s agricultural area could suffer further yield damage if it does not receive significant rainfall over the days ahead. The Buenos Aires Grains Exchange said; last month, the exchange cut its 2019/20 wheat estimate to 18.8 million tons, due to bad weather over recent months.

Forward sales of Argentine corn and soybeans are zooming higher versus last year as growers hedge against possible increases in export taxes under President Alberto Fernandez, who is set to take office on Dec. 10; with nearly half of this year’s corn already sown, and soy planting recently begun, farmers have sold 12.4 million tons of corn and 7.2 million tons of soy versus 4.6 million and 2.9 million, respectively, at this point last year.

Farmers in South America are holding back on purchasing more farm equipment until the US and China resolve their trade standoff,

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2019-11-08T14:31:06+00:00 November 8th, 2019|