Img Homepage Header

Grain News – World Supply and Demand News

It is no surprise the market continues to look at headlines for direction. Last night CFO of China’s most important technology company was arrested in Canada and is being extradited to the US. The arrest appears to be related to alleged violations of US sanctions against Iran. This headline interests me as it relates to the grain market. So far grain wires have not spoken much of technology and intellectual capital and how it relates to the negotiations, but these issues are all included in bargaining mix which sure adds complexity to our soybean exports. Grain wires report of new cases of African swine fever in China and wonder if China will buy 5 mmt of beans for their state reserves.

In world supply and demand news, private exporters reported sales of 198,120 metric tons of corn to Mexico while Algeria looks to Argentina for their corn needs. Ukrainian corn harvest is expecting a record-breaking harvest this year at 70.2 mmt with an average corn yield of 122.5 bpa. Weather maps for South America remains generally favorable.

WASDE report will be released on Tuesday, December 11th and normally this time of year the trade is in a debate over the January grain stocks report, but it seems like spring planting intentions are already taking up that space. Maybe stocks are a forgone conclusion or maybe acres are just that interesting of a story? I would choose the latter. SRW had a hard time getting seeded this fall and we are already seeing spreads and interest reflect lower wheat acres but how much and how many of these acres will get added into the corn and bean discussion? If the SRW acres discussion isn’t interesting enough the corn/bean ratio suggest we will see a sizable shift to corn while South America ramps up bean production but there is the overarching question of what kind of say will farmer financing have in the acres discussion (beans are much cheaper to put in the ground). To bring it full circle somehow the discussion over US/China intellectual property is in some why effecting spring planting intentions. At this point it seems prudent to read less headlines and spend the time looking at your costs and if there is an opportunity to sell 2019 corn and beans put an offer in and enjoy the holidays.

Posted in Blog, Grain

Grain News – Trade Truce

Last weekend’s meeting at the G20 summit in Argentina has positive impact on the market.  The results of the dinner between President Trump and Xi was a “trade truce” that will result in the US not raising tariffs on Jan 1.  There was also the signing of the new U.S.-Mexico-Canada Agreement (USMCA).

After the dinner President Trump tweeted:  “Farmers will be a very BIG and FAST beneficiary of our deal with China.  They intend to start purchasing agricultural product immediately.  We make the finest and cleanest product in the World, and this is what China wants.  Farmers, I LOVE YOU!”

Also on Monday, Treasury Secretary Steve Mnuchin expressed optimism about the future of an overall trade agreement with China.  He said China has a current offer on the table valued at $1.2 trillion in additional commitments.  It consists of more than just agricultural goods, but agriculture will be a part of the Deal.

Corn is trading higher this morning on spillover strength from soybeans.  Corn exports last week reached 40.8 million bushels, falling in the middle of trade estimates.  Mexico was the No. 1 destination.

Soybeans are trading higher this morning.  Buyers appear to have the prove it to me attitude.  Exports are still lagging with Argentina the biggest destination.  There is still a lot to digest over the China truce.  Negotiations with China have already started.

Now that harvest is slowly coming to a close please keep in contact with your grain marketing specialist to work on marketing bushels in the bins as well as 2019 crop.  We have many marketing tools in our toolbox to help you market your crop.   Please contact us to discuss your needs.

Posted in Blog, Grain