Afternoon Market Highlights
12/18/2019 4:47:32 PM
Definitely a much quieter day with no more clarity on what and how much China will buy from the US than we had when the announcement first was released. Impeachment of the US President feels like it is gaining momentum in the market place. Many in the trade are turning their attention to next week’s short trading week, in observance of the Christmas Day Holiday. SA weather is mostly favorable for Brazil and a bit iffy for Argentina, although some of the extended forecasts are suggesting a wetter pattern developing.
- Cattle on Feed estimates: On Feed December 1 at 101.9% (101.3-102.8), November placements at 101.0% (98.7-107.1) and November marketings at 97.2 (96.6-98.6). The report is scheduled for release on Friday at 2PM CT.
- January options expiration is December 27th (my apologies for the mis report in yesterday’s comments).First Notice Day for Jan futures is the 31st with long positions reported after the close on the 30th.
- Next week is a shortened trade week with an early close on Tuesday, December 24th and no trade on Wednesday, December 25th.Trade is scheduled to resume on Thursday, December 26th.
- The energy markets were mostly weaker, the US$ was stronger, the gold market was a couple bucks lower, and Wall Street was mixed.
Corn prices traded lower in sympathy with the wheat market. Prices saw pressure form lack of fresh supportive news and no confirmation of China looking to purchase US corn in the recent billion dollar deal announce a couple of days ago.
- Closes: March at $3.87, down 3 cents, July at $3.99 ½, down 2 ¾ cents, September at $3.98, down 2 ¼ cents and December at $4.00, down 2 cents.
- CIF premiums were mostly unchanged for December.
- Weekly ethanol production declined 8k barrels per day to 1,064,000 barrels per day. Stocks were unchanged at 21.8 million barrels.
- Weekly export sales estimates 1.2-2.0 mmt 2019-20 and 525-700 tmt for 2020-21.
- Spreads: H/K 6 ¾ carry, H/N 12 ½ carry, K/N 5 ¾ carry, N/Z ½ carry.
The soybean market finished the day near unchanged on a bout of technical selling and fund selling after the recent run higher. Light bean movement was noted at the higher price levels. November 20 tickled a high of $9.69 but fell short of that by the close.
- Closes: January at $9.28 ½, down ¼ cent, March at $9.40 ½, down ¼ cent, July at $9.65 ½, down ½ cent, November at $9.68 ¼, up 1 ¾ cent. The high in November today was $9.69. Consider giving your customers a poke about forward contracting some soybeans for Nov 20 at current levels or have sell orders in place for the unexpected.
- CIF premiums were 1 cent firmer for December.
- Weekly export sales estimates 950 tmt-1.4 mmt for 2019-20 and 0-400 tmt for 2020-21.
- China was thought to have purchased 2-6 cargoes of US (tariff free) soybeans overnight, although there were no flash reports this morning from the USDA. Duty free tariffs were awarded on as much as 10-15 cargoes of beans.
- Ideas are that China may be stocking up on US until the SA harvest begins next Feb or March.
- The canola market traded lower in sympathy with the US soyoil market and slowed demand for canola.
- Spreads: F/H 11 ¾ carry, F/N 37 ¼ carry, N/X 2 ¾ carry, X/F 2 ¼ carry.
Wheat prices took a step back on technical selling and fund selling as the trade becomes a bit unsure of possible Chinese purchases and the recent volumes that have been kicked around recently. Global supplies are plentiful, and competition is stiff.
- March closes: Mpls at $5.38 ½, down ¼ cent, KC at $4.61 ¾, down 5 ¼ cents and Chicago at $5.48 ¼, down 8 cents.
- Mpls March has rallied back to levels seen in early November and is above many of its moving averages.
- Spreads: Mpls H/K 8 carry, Kansas City H/K 8 ½ cent carry, and Chicago H/K at 3 ½ carry.